MultiChoice declines Canal+'s $1.6 billion offer, citing undervaluation

February 5, 2024
2 min read
MultiChoice's building
  • Following a bid to acquire MultiChoice for R31.7 billion ($1.6 billion) on February 1, 2024, the South African payTV provider has rejected Canal+'s proposal.
  • MultiChoice says that the French media’s offer undervalues the company. 
  • The Board expressed willingness to further engage with any party regarding offers that are fair in price and subject to appropriate conditions. 

Last Thursday, Canal+, which currently has a 35.01% stake in MultiChoice, revealed plans to acquire MultiChoice after submitting a non-binding indicative offer of R105 ($5.6) per share, representing a 40% premium over MultiChoice's closing share price of R75 ($4) on January 31, 2024.

The proposal assessed MultiChoice at over R46 billion ($ 2.4 billion), which would see the company pay R 32.5 billion ( $1.7 billion) in cash for the remaining 64.99% ownership it doesn’t currently possess. 

Per MultiChoice, “The delivery of the Canal+ letter [to the board making the offer] took place after discussions between Canal+ and MultiChoice lasting for well over a year.

“Following the delivery of that letter, Canal+ and its representatives have extensively discussed their proposal in public and with members of the press.”

While the South African DStv and GOtv owner acknowledged that the board is open to all means of maximising shareholder value, it informed Canal+ that its letter does not provide a basis for further engagement at the proposed price.

MultiChoice also said that concerning any formal and binding offer, the board will consistently carry out its duties following the guidelines in the Takeover Regulations. 

Recall that the South African Electronic Communication Act 2005 forbids foreigners from directly or indirectly controlling a commercial broadcasting licence or owning more than 20% of a commercial broadcasting licensee's voting shares or paid-up capital, which makes Canal+ open to challenges. 

Canal+ has previously stated that it complies with all laws and regulations relevant to the media industry in South Africa and companies listed on the Johannesburg Stock Exchange (JSE).

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