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- French media conglomerate Vivendi, owner of Canal+, has announced a firm offer to MultiChoice, owner of DStv and Showmax, offering shareholders R125 per share.
- The group had made a non-binding offer of R105 per share in February, which was rejected.
- Vivendi is also considering a European listing for Canal+ and a secondary domestic listing on the JSE, arguing that scale is essential to take on US giants like Netflix.
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French media giant Canal+ announced on Monday that it had made a mandatory offer of R125 per share to acquire MultiChoice. The new offering price is approximately 67% higher than MultiChoice's stock price just prior to its first offering in February.
Meanwhile, MultiChoice, Africa's largest pay-TV operator, has brought on Standard Bank as an independent expert to provide input on the proposal, and has agreed to work together to ensure its realization.
A non-binding offer of R105 per share was rejected as too low by the board of Africa's largest pay-TV operator in February, after which Canal Plus raised its offer to the current amount in March. MultiChoice closed at R112.33 on Friday.
Canal+, whose parent company is Vivendi, operates in 50 countries across Europe, Africa and Asia, directly serving 8 million customers in Africa. As of 2023, the total number of subscribers was approximately 25 million, and MultiChoice had 23.5 million. Both men have serious ambitions for Africa and acknowledge that they need scale to compete with American giants like Disney and Netflix.
“Canal+'s ambition is to support the commercial development of Africa's sport and cultural industries, combining scale, complementary geographies and a comprehensive and international reach with strong local roots, with a focus on Africa. “Our goal is to build a global entertainment leader that will lead and authentically deliver African stories to audiences around the world,” he said on Monday.
“This long-term vision builds on Canal+’s extensive and successful 30-year history of investing in Africa’s creative and sports broadcasting markets.”
Canal+'s parent company, Vivendi, is also currently conducting a feasibility study on a proposal, first announced in December, to split the company into several separately listed entities.
The company said that if the planned European listing goes ahead, there will be an opportunity for South African investors to become shareholders in the combined company as part of a secondary inward listing on the JSE.
Canal Plus said on Monday that it understands the need for broader black economic empowerment and will support MultiChoice in its continued efforts to transform its South African business in doing so. added. This is also a condition typically imposed by SA's competition regulator, subject to its approval, although a circular regarding the offer will be published in due course.
Complicating matters were SA laws that imposed restrictions on foreign ownership of local broadcasting licenses. This means that Canal+ can increase his MultiChoice shareholding to any level, but his voting rights will be limited to a maximum of 20%. Canal + also increased his stake in the group to more than 35%. This is the criteria that triggers the mandatory offer.
However, given voting rights caps, the Takeover Regulation Authority was then asked to rule, and in February ruled that Canal+ had to do so. After the extension, the mandatory offer deadline is now April 8th.
Read | Regulator rules Canal+ must make takeover offer for MultiChoice
MultiChoice also grants Canal+ exclusivity, which does not include engagement with other competing parties. However, if a better, unsolicited proposal is received, Canal+ will have the opportunity to amend the proposal.
“Following constructive engagement with MultiChoice, we are pleased to announce today our intention to jointly make an acquisition offer,” Canal+ Chairman and CEO Maxime Saada said in a statement. “This represents a significant premium for MultiChoice shareholders.”
“Canal+ is confident in taking this offer to a level that far exceeds the minimum level required by regulation, as we believe in the great future that Canal+ and MultiChoice can build together,” he said.
“We are excited about these opportunities, which will be supported by further investment in technology, including the continued delivery of our cutting-edge satellite services and the rollout of more innovative streaming products. ”
