Shares of fuboTV Inc. (FUBO) skyrocketed by over 21% in Monday's trading session, reflecting investor optimism following the company's transformative deal with media giant Walt Disney Co. (DIS).

Under the agreement, Disney will combine its Hulu + Live TV business with fuboTV, taking a 70% majority stake in the resulting company. This strategic move is expected to create the second-largest internet pay-TV provider in North America, with around 6.2 million subscribers and projected revenue of $6 billion.

Crucially, the merger resolves fuboTV's ongoing litigation against Disney, Fox, and Warner Bros. Discovery over the proposed Venu Sports streaming service. fuboTV had argued that the joint venture would reduce competition and drive up prices for consumers. As part of the settlement, the media companies will pay fuboTV $220 million in cash and provide a $145 million term loan in 2026.

The combined entity will operate under the fuboTV name and be led by the company's existing management team, including co-founder and CEO David Gandler. While Hulu + Live TV and fuboTV will continue as separate offerings, the partnership paves the way for a new sports and broadcasting service featuring Disney's premier networks like ABC, ESPN, and ESPN+.

Analysts view the deal as a game-changer for fuboTV, positioning the company as a formidable player in the highly competitive sports streaming market. By removing the antitrust concerns surrounding Venu Sports and gaining access to Disney's vast content portfolio, fuboTV has significantly strengthened its value proposition and growth prospects.