Canal+ has upped its offer for MultiChoice to R125 a share, as it looks to make a mandatory offer to the pay-TV operator's shareholders for shares it does not already own.
“I am pleased to confirm that, after further consideration by the boards of Canal+ and MultiChoice, Canal+ has agreed to increase the price to make the mandatory offer for MultiChoice Group for a cash consideration of R125 per ordinary share. On this basis, both companies have mutually agreed to co-operate, and MultiChoice has agreed it will give exclusivity to Canal+,” chair and CEO of Canal+ Group Maxime Saada said on Tuesday.
Accordingly, “MultiChoice will give customary exclusivity undertakings to Canal+,” the companies said in a joint statement on Tuesday.
At the start of February, Canal+ made an offer to buy out the rest of the company at R105 a share, or just more than R31bn, in what would have been the biggest M&A deal so far in SA in 2024.
The DStv owner snubbed the offer as too low for the business and its prospects, even though it is at the top end of the target price range that analysts and brokers have for the stock.
Canal+, a top shareholder in MultiChoice which had a 31.67% interest when it proposed the offer, raised its stake to 35.01% after the deal’s announcement, just above the threshold that would require the company to make a mandatory offer to shareholders.
On Monday, the French group said it would comply with an order by the Takeover Regulation Panel (TRP), issued last week, to make the mandatory offer.
While the minimum price for the mandatory offer in terms of TRP rules is about R105, Canal+ has agreed to up its price to grab shareholders’ attention.
JSE rules say that the price offered must be same or higher than the highest price paid to acquire the shares within a six-month period. This would have been much lower than R105, given that MultiChoice’s stock fell from a high of R155 in March 2023 to a low of R62 by November.
At R125, the quantum of the deal goes up to just under R37bn.
Once the offer is made, the independent board of MultiChoice will be constituted and it will provide its opinion and recommendation on the offer in accordance with regulation 110 of the Takeover Regulations.
“Nothing in this announcement should be read as limiting in any way the giving of such opinion,” said the parties.
This comes days after the Public Investment Corporation, MultiChoice’s second largest shareholder, upped its stake in the group to 15.1% from 12.25%.
“We all believe the rationale for the combination is compelling and will benefit viewers, SA’s creative industries and shareholders alike. Together we want a thriving African creative ecosystem which captivates viewers of both sport and entertainment. We plan to build on our strong track record of co-operating with MultiChoice to commission ambitious and authentic African content, and by supporting local production companies and sports broadcasting,” said Saada.
“We also remain firmly committed to a JSE listing, supporting transformation, and maintaining MultiChoice’s BBBEE status.”
MultiChoice’s share price shot up 5.94% in early morning trade to R114.83, giving it a total market value of R50.8bn, which includes the shares that Canal+ already owns.
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