Canal+ raises offer for MultiChoice, plans JSE listing

MultiChoice head office in Randburg, north of Johannesburg. Photo Simphiwe Mbokazi/Independent Newspapers

MultiChoice head office in Randburg, north of Johannesburg. Photo Simphiwe Mbokazi/Independent Newspapers

Published Apr 9, 2024


Canal+ has substantially increased its offer for the MultiChoice Group to about R37.7 billion from R31.7bn after the local broadcaster said in February that the initial offer was too low.

MultiChoice’s share price increased 4.16% to R117 yesterday morning after the improved offer was announced. The share later closed the day 4.99% higher at R117.93.

Meanwhile, should Canal+’s own planned European listing proceed, there would be an opportunity for South African investors to become shareholders of the combined entity, as part of a secondary inward listing on the JSE, the companies announced yesterday.

Vivendi, the parent of Canal+, is currently doing a feasibility study to split the company into several separately listed entities. Canal + has 26.4 million subscribers, 17 million of which are outside France. MultiChoice claims 23.5 million subscribers.

The two groups said they had reached an agreement on proceeding and cooperating with the Canal+ takeover bid, that was formally announced on February 1, 2024, following talks between them of over a year.

Canal+’s stake in MultiChoice amounted to 35.01% by February 5, and this stake amounted to 36.6% on April 5.

The offer to MultiChoice shareholders was yesterday increased to R125 per share, from R105 cents when Canal+ first made the offer, which is “significantly above the minimum price of R105.00 required by the Takeover Regulations,” the companies said in a statement.

The new price represented a 66.66% premium to the R75 price on February 1, the last trading day prior to the offer first being made.

It is also a 63.96% premium to the R76.24 30-day volume weighted average price on the last trading day, prior to the offer being delivered.

Canal+ has said that its aim is to build a global entertainment leader, with Africa at its heart, combining scale, complementary geographies, and international reach with strong local roots, that will support the development of Africa's sporting and cultural industries, and “take leading and authentic African stories to a global audience.”

Recognising South Africa’s black economic empowerment imperatives, it intends to support MultiChoice’s BBBEE initiatives and the transformation of its South African business.

Canal+ believes the offer would also provide MultiChoice shareholders with an opportunity to realise value at a significant premium, in cash.

“Canal+ believes the competitive landscape for Africa's media and entertainment industry will continue to undergo profound changes as the continent rapidly adopts broadband and mobile internet.”

This allowed international media companies and global OTT platforms (including Netflix, YouTube, Disney and Apple TV+), to use their scale and resources, to expand beyond their existing markets, increasing their focus on Africa and thereby challenging local rivals.

“A combined group would be better positioned to address key structural challenges and opportunities resulting from the progressive digitalisation and globalisation of the media and entertainment sector. This could have significant benefits for the African creative and sports ecosystems, for example, by enabling high-quality content created on the continent to be distributed to an international audience,” the companies said.

Also, through the combination with Canal+, in addition to operating in over 50 countries across Africa, MultiChoice would be part of a broader group, present across three continents: Africa, Europe and Asia. As a result, MultiChoice would benefit from the combined group's scale across its entire footprint.