France’s Canal+ makes offer to buy MultiChoice

French media giant Vivendi SE’s Canal+ made a non-binding offer to acquire MultiChoice Group, which it said would help grow the South Africa-based pay-TV company globally. MultiChoice’s shares jumped as much as 27%.

The offer – which Canal+ anticipates will be R105 a share in cash – represents a 40% premium to MultiChoice’s closing price on Wednesday of R75, the French film and TV studio firm said in a statement yesterday.

A deal “will allow investors to benefit from the combination of Canal+ and MultiChoice, our ultimate goal being to also obtain a listing in South Africa”, Canal+ said.

MultiChoice shares traded up 26% at R94.34 by morning in Johannesburg.

Canal+ is already the biggest shareholder in MultiChoice, with a 31.7% stake. The South African firm, which operates in 50 countries across the continent, was spun off from Naspers and listed separately in February 2019.

The announcement of the offer comes two days after French billionaire Vincent Bolloré’s Vivendi formally proposed breaking up the sprawling media and entertainment empire into four separately traded companies, and Canal+ is actively preparing its own listing.

Formed in SA in 1985, MultiChoice expanded across Africa in the early 1990s with packages including live English football matches and local shows. It owns Showmax, a streaming service that’s working with companies including US-based Comcast to rival the likes of Netflix.

A combination between Canal+ and MultiChoice would create a group with significant scale and the ability to commit greater investment to local content and sport, while providing MultiChoice with a larger and more diversified geographical footprint, Canal+ said in the statement.

Canal+ has submitted a letter detailing its non-binding indicative offer to MultiChoice’s board and will deliver a firm-intention letter once it has completed a due-diligence exercise, the company said.

For now, there’s no certainty about the progression of the potential offer, it said. –