A French company, Canal+, has offered to acquire South African pay-TV giant MultiChoice for around R31.7bn ($1.7bn).
In a statement issued by the Paris-based firm on Thursday, Canal+ announced that it submitted a non-binding indicative offer to MultiChoice’s board to acquire all of the issued ordinary shares it does not already own, subject to obtaining the necessary regulatory approvals.
In its last annual report, MultiChoice revealed that Canal+ owned 140,160,277 of its 442,512,678 issued shares.
Local reports said that over the past four years, Canal+ had steadily bought MultiChoice shares on the open market until it held over 30 per cent of the company.
Canal+ offered R105 per ordinary share, representing a premium of 40 per cent to MultiChoice’s closing share price of R75 on January 31. Buying out the remainder would cost Canal+ close to R31.75bn ($1.7bn).
Canal+ said that its acquisition would transform MultiChoice into a global-scale media company.
The chairman and Chief Executive Officer of Canal+, Maxime Saada, in the statement, said, “For MultiChoice to continue to thrive in Africa it will require a strategy that enhances its scale as well as strengthened local and global expertise.
“Our potential offer, if successful, would be an important next step for MultiChoice to realize its full potential.”
Meanwhile, Canal+ disclosed that it intends to list in response to parent firm Vivendi’s intentions to divide into four entities, with the ultimate goal of listing in South Africa.
“This will allow investors to benefit from the combination of Canal+ and MultiChoice, our ultimate goal being to also obtain a listing in South Africa,” it stated.
“It is the ambition of Canal+ to create an African media business with enhanced scale, which can thrive in a competitive international market, better serve its consumers with a world-leading offering of sports, local and global content, and ensure that Africa can tell her story to a global audience on her terms.
“However, the media industry in which MultiChoice is operating is becoming increasingly globalised and competitive, with regional media companies having to compete with the firepower of global media titans, with enormous resources to invest in content, marketing and technology,” part of the statement read.
Canal+ said scale was the only way to survive and thrive in the environment.
“A combination between Canal+ and MultiChoice would create a group with significant scale, putting MultiChoice on a secure long-term path and enabling the company to thrive.
“Should this combination not proceed, this lack of scale is likely to become a more acute problem in the coming years, risking the company’s status as the pre-eminent media company in Africa and impacting its mid-term trajectory,” the firm said.
In November 2023, MultiChoice Group revealed that its user base grew by 69 per cent over the last six months.
In a statement, the company noted that it executed well on its operational objectives during the six months ended 30 September 2023 (1H FY24).
Canal+ is a French premium television channel launched in 1984. It is 100% owned by the Groupe Canal+, which in turn is owned by Vivendi.