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According to Reuters, Canal+ is interested in acquiring MultiChoice and has already submitted a proposal.
Multichoice also confirmed this information, noting that it had received a letter from Vivendi’s Canal+ and would notify shareholders if there were any additional developments.
Canal+, a key Multichoice shareholder with a 31.67 percent holding according to LSEG figures, has announced that it will pay 105 rands ($5.61) in cash for each share, a 40% premium over MultiChoice’s closing share price on Wednesday.
“Shares in MultiChoice rose further in Thursday morning trading but remained significantly below the bid price, reflecting a lack of investor confidence that the transaction would go through. According to Reuter’s report, they were most recently up 23% at 92 rand.
“Canal Plus said its current offer, worth 31.7 billion rand according to Reuters calculations.”
“For MultiChoice to continue to grow in Africa, it will need a plan that increases its scale while also strengthening local and global competence. Our proposed offer, if successful, would constitute an essential next step for MultiChoice in realizing its full potential,” Canal+ chairman and CEO Maxime Saada said in a statement.
Multichoice, which serves 50 African countries, has been aggressive in its efforts to fend off competition from multinationals like Netflix and Amazon. This is seen in MultiChoice’s campaign to invest in local content.
Canal+’s CEO and Chairman stated that the acquisition would provide Multichoice with the resources to increase its investment in local content.
“As part of MultiChoice’s efforts to fight off competition, it partnered last year with Comcast’s (CMCSA.O), opens new tab NBCUniversal and Sky to revamp MultiChoice’s existing Showmax streaming service, which now offers LIVE Premier League content,” according to a report from Reuters.
Canal+ has said that it aims to aggressively list in reaction to parent company Vivendi’s plans to split into four entities, with the ultimate goal of listing in South Africa.
