• Canal+ has aspirations of building a media company that can go toe-to-toe with global media giants.
• In order to do that it’s offering MultiChoice R105 per share to acquire the African media company.
• Canal+ already owns 31 percent of MultiChoice shares.

This morning, French media company Canal+ announced it had made a non-binding indicative offer to acquire MultiChoice. Subject to regulations of course.

The French media firm said that it was willing to pay R105 per MultiChoice ordinary share representing a 40 percent premium on the R75 per share MultiChoice stock was trading at on 31st January.

As you might be aware, Canal+ is MultiChoice’s largest shareholder and as of July 2023, it owned 31.7 percent of MultiChoice’s shares.

Now, as Canal+ unbundles itself from parent company Vivendi, it seems to have broader ambitions and wants to build its own media empire.

“It is the ambition of Canal+ to create an African media business with enhanced scale, which can thrive in a competitive international market, better serve its consumers with a world leading offering of sports, local and global content, and ensure that Africa can tell her story to a global audience on her own terms,” Canal+ said in a statement.

In the French firm’s opinion, media firms such as itself and MultiChoice face increasing competition from global firms. By joining forces the pair would be able to gain more ground against those global firms.

“Canal+ is a long-term investor in both MultiChoice and South Africa, and is proud to have been actively involved in Africa’s media sector for 30 years. For MultiChoice to continue to thrive in Africa it will require a strategy that enhances its scale as well as strengthened local and global expertise,” chairman and chief executive officer of Canal+ Group, Maxime Saada.

The CEO says that by taking up the Canal+, MultiChoice will be able to scale its investment in local talent and stories thanks to the resources the French company brings to the table.

“We believe that with greater scale, as part of a combined group with Canal+, MultiChoice would enhance its ability to navigate the structural challenges facing the media sector, creating and securing jobs and providing a platform for the continued success of MultiChoice as Africa’s leading media company,” Saada added.

Whether MultiChoice will take this offer is unclear at this stage. It has alerted its shareholders to the fact that it received this offer but aside from advising caution when dealing with MultiChoice shares, there is no word on whether it intends to accept the offer, at least not yet.

With that having been said, with a 40 percent premium being offered, we suspect that the decision makers at the media company will be debating this offer for a few days at least.