Canal+ makes formal offer to buy MultiChoice Group

French pay-TV company Canal+ has made an all-cash mandatory offer to buy all shares it does not already own of South African pay-TV and streaming company MultiChoice Group for R125 (US$6.70) per share.

In a joint statement issued via the Johannesburg Stock Exchange (JSE), the two companies said Canal+ will offer R125 for each ordinary share of MultiChoice, which is significantly above the minimum price of approximately R105 ($5.60) required by South Africa's Takeover Regulations.

In early February 2024, Canal+ offered R105 ($5.50 at the time) per MultiChoice ordinary share – which represented a 40% premium on MultiChoice's closing share price on the JSE of R75 ($3.13) on January 31, 2024. But MultiChoice said the offer significantly undervalued the company and rejected it.

Then, in March 2024, the French pay-TV firm made a mandatory offer to MultiChoice shareholders to take up all shares it does not already own.

MultiChoice told investors it had agreed to work closely with Canal+ on a mandatory offer and it will grant the French company certain customary exclusivity undertakings. (Source: Freepik)

"MultiChoice and Canal+ will use reasonable endeavors to cooperate in relation to the Offer including in relation to the fulfilment of the Offer conditions and the publication of a combined Offer circular," the companies said of the deal.

Furthermore, MultiChoice said it has granted Canal+ certain customary exclusivity undertakings.

The need to make a mandatory offer was triggered by Canal+ raising its holding in MultiChoice above the 35% threshold. Canal+ now has a 36.6% stake, as it has continued to buy MultiChoice shares in the open market.

As set out in the joint announcement, MultiChoice has formed an independent board, which appointed Standard Bank as an independent expert to express a view on the fairness and reasonableness of the terms of the offer.

MultiChoice making headlines

In preparation for the takeover deal with Canal+, MultiChoice extended Chairperson Imtiaz Patel's tenure until the ongoing deal is completed.

MultiChoice has recently partnered with other major industry players as well.

In March 2023, the company partnered with US-based Comcast's NBCUniversal and UK-based Sky to create a pan-African streaming service.

Follow Connecting Africa on our new X account @connect__africa to get the latest telecoms and tech news across Africa.

Under that deal, 70% of the new Showmax streaming platform is owned by MultiChoice and 30% by NBCUniversal, and it's powered by Peacock's globally scaled technology.

Earlier this year, the companies relaunched MultiChoice's Showmax streaming video entertainment offering and committed to further investment in the platform.

*Top image source: Freepik.

— Matshepo Sehloho, Associate Editor, Connecting Africa