• When Canal+ acquired a total of 35.01 percent of MultiChoice shares it triggered a clause in the South African Companies Act.
• Per that legislation, Canal+ must make a mandatory offer to acquire the remainder of MultiChoice’s shares by 8th April after being granted an extension.
• Last time it tried to acquire MultiChoice, Canal+ offered R105 per share and that was rejected.

Before it made an offer to acquire MultiChoice, Canal+ went ahead and purchased more of the media firm’s shares. Today, Canal+ owns 35.01 percent of MultiChoice’s shares.

Surpassing the 35 percent mark, even just by 0.1 percent, triggered a clause in the Companies Act which now compels the French media company to make an offer to acquire the rest of MultiChoice’s shares. While the company did make an offer to acquire MultiChoice, that offer didn’t qualify as a mandatory offer as outlined in the act.

Unfortunately, the time to make this mandatory offer has passed and so Canal+ approached the Takeover Regulation Panel for an extension which it has been granted.

“Canal+ respects the decision taken by the Panel, and will comply with it. On this basis, Canal+ confirms that it has applied for and received from the Panel an exemption from adhering to the timing requirements in Regulation 101(3)(b) of the Companies Regulations, 2011 (the “Regulations”), which requires that a firm intention announcement be made immediately when a mandatory offer is required to be made in terms of Section 122(1) read with Section 123 of the Companies Act No. 71 of 2008,” Canal+ told shareholders.

The French media conglomerate now has 25 business days (until 8th April) to submit an offer to purchase the remainder of MultiChoice’s shares.

The last time Canal+ made an offer, it said it was willing to pay R105 per ordinary share, a 40 percent premium on the R75 shares that were trading at when the offer was made.

That offer was rejected with MultiChoice stating that offer was well below what it believed the business’ value was.

We’re sure that Canal+ will keep this in mind when it makes its mandatory offer but whether MultiChoice will accept it remains to be seen.

“The MultiChoice board of directors (“the Board”) will continue to act in the best interests of the Company and its shareholders. Shareholders will be updated should there be any further developments,” MultiChoice investors were told.

The pursuit of MultiChoice is part of Canal+’s vision to create a media empire as it unbundles itself from parent company Vivendi. The acquisition of an African media titan would go a long way toward making that a reality but its offer is going to have to be much larger than it was a month ago.

[Image – Katharina Kammermann from Pixabay]