Providence Nears Sale of Hulu Stake: Report

There’s finally some good news for Providence Equity Partners on its Hulu investment.

Providence is near selling its 10% stake in the company to Hulu’s other investors Walt Disney, Comcast Corp., and News Corp., according to Bloomberg News. The buyers are paying $200 million, which is twice what Providence invested in the video streaming service. The sale values Hulu at $2 billion, the story says.

Hulu employees, including CEO Jason Kilar, will also be allowed to sell shares, the story says.

The sale should come as a big relief for Providence Equity, which is currently out fundraising for its seventh pool, Providence Equity Partners VII LP. The fund has a $6 billion target, half of Providence’s prior pool, peHUB has reported. The firm’s prior fund raised $12.1 billion in 2007. Fund VI has a net IRR of 3.6%, according to Sept. 30 data from CalPERS.

Hulu is one deal that Providence hasn’t been able to exit. The PE firm invested $100 million in Hulu in 2007. Hulu was expected to file for an IPO in 2010 but ended up pulling those plans. A year later, Hulu also went up for sale and potential bidders were believed to include Google, and DirecTV. Hulu, in October, it called off the sale.

This week, Providence also announced it made a minority investment in The Chernin Group, the movie and TV production company from former News Corp. COO Peter Chernin.

Chernin, who will become a senior advisor to Providence, worked closely with the PE firm in creating Hulu, according to the L.A. Times.

Hulu declined comment. Providence couldn’t be reached for comment.

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