MultiChoice Rejects Acquisition Offer From Canal+, Cites Unfair Pricing, Inappropriate Conditions

Following a bid to acquire MultiChoice for $1.6 billion on February 1, 2024, the South African payTV provider has rejected Canal+’s proposal.

The pay-TV provider said the French media’s offer undervalues the company

The Board expressed willingness to further engage with any party regarding offers that are fair in price and subject to appropriate conditions.

Canal+, which currently has a 35.01% stake in MultiChoice, revealed plans to acquire MultiChoice after submitting a non-binding indicative offer of R105 ($5.6) per share, representing a 40% premium over MultiChoice’s closing share price of R75 ($4) on January 31, 2024.

The proposal assessed MultiChoice at over R46 billion ($ 2.4 billion), which would see the company pay R 32.5 billion ($1.7 billion) in cash for the remaining 64.99% ownership it doesn’t currently possess.

MultiChoice, however, on Monday said that according to a recent valuation exercise, the company was worth much more. “After careful consideration, the board has concluded that the proposed offer price of R105 in cash significantly undervalues the Group and its future prospects,” the company said.

“Therefore… it has conveyed to Canal+ that – at this proposed price – the letter does not provide a basis for further engagement.”

While the South African DStv and GOtv owner acknowledged that the board is open to all means of maximising shareholder value, it informed Canal+ that its letter does not provide a basis for further engagement at the proposed price.

MultiChoice also said that concerning any formal and binding offer, the board will consistently carry out its duties following the guidelines in the Takeover Regulations.