Canal+ and MultiChoice finalize agreement on acquisition deal

MultiChoice Group has notified its shareholders of a “cooperation agreement” with French media powerhouse Canal+. This collaboration is centred on a mandatory offer that Canal+ is required to make under regulations following its acquisition of over 35% equity in MultiChoice in 2024.

The latest news indicates Canal+, owned by Vivendi, has further increased its stake in MultiChoice as the two firms collaborate to finalize this buyout. Canal+ has been consistently purchasing MultiChoice shares in the open market, and currently holds a stake of 36.6% in the South African entertainment company.

In their combined statement, MultiChoice and Canal+ vowed to use “reasonable endeavours” to cooperate regarding the offer. This includes meeting the offer conditions and publishing a shared offer circular.

South Africa’s Takeover Regulation Panel compelled Canal+ to make a mandatory bid for the remaining MultiChoice shares it did not own, setting the minimum offer price at R105 per share.

Canal+, a French media company, has exceeded the set minimum price by offering MultiChoice shareholders R125 per share, which is a major increase. This new offer price is almost 67% higher than the share price of MultiChoice just prior to the initial offer made in February.

The takeover regulation panel has allowed Canal+ until April 8 to finalize the purchase. However, if required, this deadline may be extended with the consent of the South African Takeover Regulation Panel.

Complying with legal requirements for the acquisition process, MultiChoice has formed an independent board to assure the fairness and reasonableness of Canal+’s offer. To evaluate the conditions of the offer and provide an impartial and reasonable viewpoint, this board has engaged Standard Bank of South Africa Limited as an independent expert.

If the transaction is successful, MultiChoice might potentially be removed from the Johannesburg Stock Exchange (JSE) as Canal+ reserves the right for such an action. This could serve as another blow for the Southern African stock exchange, which has seen several companies going private in recent years.

However, Canal+ has stated that should its intended European listing be successful, it would provide an opportunity for South African investors to hold shares in the merged entity through a secondary inward listing on the JSE.