Major French broadcaster Groupe Canal+ has triggered a compulsory takeover offer under the Companies Act by acquiring 35.01% of the shares of Multichoice Group, which is listed on the JSE. This is partially enforced by the Takeover Regulation Board (TRP).
So what happens next?
According to regulations, Canal+ plus must make a “firm statement of intent” to MultiChoice shareholders. Article 111(2) of the Companies Regulations (Companies Law Annex) provides that the offer price must be at least the highest price paid by Canal + to acquire his MultiChoice shares in the previous six months. I am.
“However, Regulation 111(3) allows for a departure from the principle of paying the highest price if the offeror (Canal+) determines that the principle does not apply in a particular case. [TRP]According to the regulations, we have the discretion to agree to an adjusted offer consideration if we consider it appropriate under the circumstances. ”
Canal+ has been steadily buying up shares in MultiChoice since 2020. Meanwhile, the South African Broadcasting Group's share price soared above R120 per his share. However, over the past year, prices have fluctuated from a peak of over R150 per share reached in February 2023 to a low of R63.21 per share in November last year.
It is unclear what the highest price Canal+ paid for MultiChoice shares in the past six months, but historical price data suggests the value was at least between R63 per share and R92 per share. There should be. This is well below R105 per share. The French broadcaster said it was willing to pay shareholders to secure the deal.
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MultiChoice's share price peaked at R105 per share earlier this month following Canal+'s indicative offer, which MultiChoice rejected as “undervaluing” the company. It touched 105.78 runs in Wednesday morning trade following the news of TRP's decision to make a mandatory offer, but by the lunch break it had retreated slightly.
According to the TRP guidelines, Canal+ has the right to approach MultiChoice's shareholders to discuss the proposal prior to the announcement of firm intent, but shareholders are obliged to keep these discussions confidential until the announcement is formally published. .
Read: Big drama as Canal+ tells MultiChoice to make must-have offer
Only shareholders holding 5% or more of MultiChoice will be able to approach the deal. This means Canal+ will be able to negotiate with the Public Investment Corporation (PIC) and Allan Gray, who hold 12.25% and 6% of MultiChoice respectively. Available disclosures found by TechCentral.
Of course, if MultiChoice shareholders don't like the offer, they could reject any future mandatory offers from Canal+. If shareholders wish, they may vote to waive the mandatory offer by voting and then notifying TRP of their decision.
For a mandatory offer to be successful, 50 per cent of the voting rights, excluding those held by Canal+ (which is understood to be capped at 20 per cent), must agree. Apart from that, Canal+ has no freedom to withdraw from the contract.
However, even if the deal were approved by shareholders, Canal+'s efforts to acquire MultiChoice could still be hampered by legislation that limits foreign companies' voting control of South African broadcasting licensees to 20%. There is. This restriction is contained in the Electronic Communications Act.
A Canal+ spokesperson was not immediately available for comment, but the company has previously said it believes the legal restrictions are not insurmountable. – © 2024 News Central Media