AT&T has reached a deal to sell its anime-centric streaming TV service Crunchyroll to Sony for $1.175 billion in cash, the two companies announced on Wednesday.
The deal fulfills a desire by AT&T to sell the streaming service to Crunchyroll as was first revealed in August by business publication The Information, but for slightly less than the $1.5 billion AT&T was seeking back then.
Crunchyroll launched in 2006 with animation shows and television dramas sourced largely from Japan. It was acquired by WarnerMedia when the service’s parent company Otter Media was purchased by AT&T in 2018.
The streaming service has more than 3 million subscribers willing to pay for its content and another 90 million registered users across 200 countries and territories where it operates. Some shows are available to stream for free with commercial advertisements.
In addition to the television content, the Crunchyroll brand includes smartphone games, merchandise and comics known as “manga.”
Some of Crunchyroll’s 3,000 TV shows were included in AT&T’s blockbuster streaming service HBO Max when it launched in May. It was not clear if this content would continue to be offered to HBO Max subscribers following its sale to Sony where it will be operated under the electronic company’s Funimation subsidiary.
“We are proud to bring Crunchyroll into the Sony family,” Tony Vinciquerra, the chief executive of Sony Pictures Entertainment, said in a statement on Wednesday. “Together with Crunchyroll, we will create the best possible experience for fans and greater opportunity for creators, producers and publishers in Japan and elsewhere.”
Many of the executives who are assigned to Crunchyroll at AT&T will move over to Sony as part of the deal, including the subsidiary’s current general manager Joanne Waage.
“We are excited to embark on this new journey,” Waage said. “Combining the strength of the Crunchyroll brand and the expertise of our global team with Funimation is an exciting prospect and a win for the incredible art form of anime.”
The decision to sell Crunchyroll comes as AT&T looks to offload some of its assets in order to draw down its debut, which has weighed its stock price in recent years. On Wednesday, the Wall Street Journal said the phone company was in the final stages of an auction to divest its satellite TV service DirecTV for as much as $15 billion.
Disclosure: The author of this story owned a small amount of AT&T stock as of this writing.