South African regulator orders Canal+ to bid for remaining shares in Multichoice

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February 28, 2024
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2 min read
MultiChoice's building
  • The South Africa Takeover Regulation Panel has directed Canal+, a French media company, to make an offer to buy MultiChoice's shares that it does not already own. 
  • Per the Panel’s ruling, “Canal+ must take immediate action to comply with the requirements of.. the (Companies) Act and the regulations by making a mandatory offer to the remaining shareholders of MultiChoice.”
  • The regulator determined that Multichoice's public announcement of the initial offer was illegal and issued a compliance notice to the South African company.

This development follows the panel’s reaction to the open discussion about a possible takeover between Canal+ and MultiChoice. 

On February 6, the panel acknowledged the receipt of communications and announcements from the two companies. However, it declined to endorse or approve the developments, stating that discussions with the two companies are ongoing to provide advice and guidelines on handling the situation.

The Panel reiterated its commitment to taking the matter seriously, stating that the investigation aims to ensure that both parties fulfil their overarching obligation and responsibility to maintain market integrity and ensure market fairness for holders of MultiChoice's securities. 

On February 1, Canal+ revealed its intentions to acquire the South African pay-TV service after submitting a non-binding indicative offer of R105 ($5.6) per share. This offer represents a 40% premium compared to MultiChoice's closing share price of R75 ($4) on January 31, 2024.

The valuation of MultiChoice through the offer exceeds R46 billion ($2.4 billion), resulting in the company proposing to pay R32.5 billion ($1.7 billion) in cash for the remaining 64.99%. The French Media currently owns a 35.01% stake in MultiChoice.

In response, MultiChoice rejected Canal+'s proposal, stating it undervalued the company. Nonetheless, the board expressed a willingness to continue discussions with any party regarding offers deemed reasonable in price and subject to suitable terms.

Canal+ has faced challenges with this transaction due to the South African Electronic Communication Act 2005, which prohibits 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.


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