Vivendi’s Canal+ Group has made an offer to take full control of African entertainment company The MultiChoice Group, in which it already holds a 31.7% stake.
“The Canal+ Group confirms that it has submitted to the board of directors of MultiChoice a letter containing a non-binding indicative offer with a view to acquiring all of the issued ordinary shares of MultiChoice that it does not yet hold, subject to obtaining the necessary regulatory approvals,” the Paris-based pay-TV giant said in statement on Thursday.
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Canal+ said it has offered 105 South African rand ($5.61) per ordinary share, which was a 40% premium on their closing price of R75 on January 31.
The group emphasized that neither “the evolution” or “the conditions of a possible transaction” were “certain”, adding that any operation would comply with all laws and regulations related to the South African media sector and companies listed on the Johannesburg Stock Exchange.
It remains to be seen whether the offer will gather steam given that South Africa currently has rules in place limiting foreign ownership of commercial South African broadcasters to 20%, although moves are underway to increase this to 49%.
The move to acquire MultiChoice outright comes a month after parent group Vivendi announced it was studying a project to split its activities into several entities.
“Canal+ is actively preparing its stock market listing following the announcement of the proposed split from its parent company Vivendi,” read Thursday’s Canal+ Group statement.
“This project would allow investors to benefit from the merger of Canal+ and MultiChoice, the ultimate objective of the Canal+ Group being to also obtain a listing in South Africa.”
The Canal+ Group, which started building a position in MultiChoice in 2020, said its aim was to create “a large-scale African media company capable of thriving in an increasingly competitive international market.”
“Canal+ is a long-term investor in MultiChoice and South Africa, and is proud to have been actively involved in the African media sector for 30 years. To accelerate MultiChoice’s development in Africa and beyond, it will need to adopt a strategy that will enable it to increase its size and strengthen its local and global footprint,” said Canal+ CEO Maxime Saada.
“Our potential offer, if successful, will be an important step in enabling MultiChoice to realize its full potential. Combined with Canal+, MultiChoice would have the resources to gain scale and invest in local African talent and stories, and would have the necessary proprietary technology resources,” he continued.
“We are convinced that a merger of our two groups would enable the new entity to address the structural challenges facing the media sector, to develop authentic and ambitious African content, to support more local production companies, and to expand access to sport for its subscribers while investing in local sport.”
Created in the early 1980s, with backing from South African technology giant Naspers, MultiChoice currently has some 20 million subscribers across Africa.
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