The Walt Disney Co. has just completed a masterclass in Strategic Asset Management

It’s official. The Walt Disney Company (HAZE 0.53%) intends to become a 70% owner of streaming TV equipment (and cable alternative) FuboTV (FUBO -4.26%). Disney’s similar Hulu+Live service, in turn, will become part of FuboTV, although (at least for now) the two brands will continue to operate separately. Most notably, the deal also means Fubo will drop its efforts to prevent Walt Disney from co-launching a sports-centric streaming service in partnership with Fox and Warner Bros. Discovery – perhaps the final goal of the negotiations.

Fubo will remain a publicly traded company, to be clear — Disney will simply be its largest shareholder and buy shares not yet issued within the next year and a half.

On the surface, it seems like a win-win. And in many ways it is. Walt Disney can continue with the debut of its sports-interested Venu platform, while FuboTV shareholders can bask in the 250% gain their shares experienced immediately after the announcement was made on Monday morning. Some say the development may well have saved the small business, as it also requires much-needed funding from The Walt Disney Company.

The deal arguably favors Disney far more than it favors Fubo, though for reasons that are obscured by all the post-announcement noise.

The Walt Disney Company isn’t buying – it’s setting the stage for a future sale

While it was cheered by most, the deal is actually a bit unusual in light of Disney’s other option. It is the outright acquisition of Fubo, which at the time the deal was announced had a market value of less than $500 million. Even a 100% premium to last Friday’s closing price would still have been affordable for deep-pocketed Disney, which has $6 billion of cash on its balance sheet right now.

Disney is also no stranger to the cable TV industry; its Hulu+Live platform similarly delivers live network broadcasts and other cable TV content to 4.6 million subscribers, compared to FuboTV’s more modest headcount of 1.6 million cable-alternative customers.

But what if The Walt Disney Company doesn’t want to be in the cable TV business anymore? What if the media giant would rather just focus on content creation and sell that content directly to consumers, bypassing the conventional cable industry?

That seems to be what Disney wants, as that’s exactly what this deal does.

That’s not to suggest that Walt Disney unloaded a lemon on Fubo for what ends up being an insignificant price. Hulu+Live is earnings before interest, taxes, depreciation and amortization (EBITDA) profitable, and the combination of this business with FuboTV’s similar cable alternative is expected to be even more profitable, operating under one umbrella. Perhaps Fubo will be able to do more with the familiar Hulu brand than Walt Disney ever managed.

However, the cable industry is not exactly high growth. In fact, streaming alternatives to cable TV are increasingly running against conventional cable. These are, of course, increasing carrier fees in an environment where consumers are enjoying an increasing number of live streaming options, and now the prospect of streaming cable-like TV is regulated like regular cable TV.

In many ways, the Walt Disney Company has probably just left a sinking ship. Underlining its disinterest in the business, Disney – despite being the majority owner – allows FuboTV’s current management team to continue running the business.

To the extent it still owns a stake in cable-like player FuboTV, it can afford to lose its 70% stake in the company at a loss at any point in the future. Even after the stock’s recent rally, Fubo’s market cap is still less than $2 billion.

Live sports will soon be available in all varieties, sizes, colors and price ranges

The irony? Walt Disney himself may be the main reason why things are going from bad to worse for the cable TV industry.

That’s not the only reason consumers still pay sky-high monthly bills for cable TV, but according to figures from CableTV.com, access to live sports is the main reason people still pay for cable. Knowing how their cable TV service works is a close second reason. (Those two reasons alone account for more than half of consumers’ willingness to stick with cable.)

However, change is underway on both fronts. Amazon Prime is now the exclusive provider of Thursday night NFL games, for example. Even Netflix ventures into this territory with the almost exclusive broadcast of two Christmas Day games.

ESPN, of course, remains the powerhouse of the sports television industry. The sports-focused cable channel remains a staple of all major cable TV plans, offering programming not available anywhere else. Even that is changing, however. The imminent launch of Venu will include all live sports broadcasts from Warner’s TNT and TBS, Fox’s Fox Sports and FS1, and perhaps most notably everything ESPN offers, including its flagship cable channel’s live broadcast.

If sports really are the main reason people haven’t cut the cord yet, a cord-cutting wave is building.

That wave is also likely to accelerate briefly later this year, by the way, when Disney plans to launch a standalone streaming version of ESPN that will even partially compete with Venu.

The Walt Disney Company no longer has to worry about the ever-growing challenges of the cable television industry. It is now able to effectively monetize all of its big-ticket content in several other ways outside of cable’s reach.

Focus on the bigger, long-term picture

So what now? Provided that Fubo’s shareholders and supervisory authorities approve the transaction, there is nothing that the shareholders of the company can or do not need to do. However, there is an argument for trading both stocks.

For Walt Disney stock, the already bullish case just got even more bullish.

Although the stock stumbled following the news of the deal with FuboTV, this deal solves a handful of short-term problems for Disney, while also providing cost-effective choices further down the road. Namely, if it wants to get out of the streaming-cable business entirely, it can do so by selling the 70% of shares in Fubo that it will soon buy for little more than a song.

As for FuboTV, the stock’s recent surge could be an opportunity for a profitable exit — at least for a portion of all open positions.

While the deal is more or less set, the only detail missing so far is the price at which The Walt Disney Company will make its future purchase of its 70% stake in Fubo. That will likely reflect the price of Fubo stock closer to the time the deal closes, but there is no particular contractual reason why FuboTV shares are guaranteed to remain at their current high levels. Indeed, given that this week’s knee-jerk buy only unfolded based on the premise of the deal, there’s a good chance Fubo stock is poised to bounce back at least a little bit in the near future.