French media giant Canal+ has, for a while, been eyeing a significant buyout of South Africa’s MultiChoice Group. For those unfamiliar with these developments, here’s a breakdown of what’s been happening and what it could mean for shareholders and the broader market.
Read About: Canal+ makes bold move to acquire MultiChoice Group
MultiChoice Group recently revealed that Canal+ has been steadily increasing its stake in the broadcaster. This move follows Canal+’s acquisition of more than 35% of MultiChoice’s equity earlier this year, which triggered a mandatory offer under South African regulations.
In a statement to investors, MultiChoice announced its willingness to collaborate closely with Canal+ on the impending mandatory offer. This “cooperation agreement” entails both broadcasting giants working together to fulfill the conditions of the offer and publish a comprehensive combined offer circular.
Canal+ hasn’t been shy about its intentions, expressing a desire to offer MultiChoice shareholders R125 (USD 6.7) per share in cash. This offer stands notably above the regulatory minimum of around R105 (USD 5.7), as highlighted by the JSE-listed broadcaster.
The numbers
As of now, Canal+ holds a 36.6% stake in MultiChoice, steadily increasing its foothold in the company. However, the deal’s completion hinges on various factors, particularly regulatory approvals.
The deadline set for the deal’s conclusion is April 8, 2025, which could be extended with the approval of South Africa’s Takeover Regulation Panel.
As part of the process, MultiChoice has established an independent board to assess the fairness and reasonableness of Canal+’s offer, a step required by law in such transactions.
Should the buyout move forward, MultiChoice Group might bid farewell to the Johannesburg Stock Exchange (JSE). This potential delisting could mark a significant shift, especially considering the trend of South African companies opting for private ownership in recent years.
Canal+’s offer includes provisions for delisting if accepted by shareholders holding at least 90% of eligible MultiChoice shares. However, Canal+ also hints at an interesting twist: the opportunity for South African investors to participate in its proposed European listing.
The French firm has floated the idea of a secondary inward listing on the JSE, allowing local investors to gain exposure to the combined entity if Canal+’s European listing materializes before the offer’s closure.
MultiChoice and Canal+ aim to present a combined circular to MultiChoice shareholders by May 7. This circular will likely provide a more detailed picture of the offer, its implications, and the potential avenues for shareholders in both companies.
