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Canal+ has intensified its pursuit of the South African entertainment powerhouse, MultiChoice Group, by proposing an increased bid of R125 per share, following its earlier offer of R105 that wasn't warmly received. This revised bid now values MultiChoice at approximately R55 billion ($2.9 billion), marking a significant move within the African media landscape.
Maxime Saada, the Chairman and Chief Executive Officer of Canal+, confirmed the details of the heightened offer, which has put both companies into a decisive phase of "exclusive" negotiations. The French media conglomerate's push to secure the deal is a clear indication of its strategic intent to cement its position within the continent's burgeoning media industry.
Multichoice Group, a key player in the digital entertainment sector, has become an increasingly valuable asset in a region characterized by rapid population growth and a demographic that skews younger. Vivendi's eagerness to add MultiChoice's assets, including the Showmax streaming platform which directly competes with Netflix Inc, reflects its objective to dominate the African media market.
Industry insiders revealed that Vivendi's Canal+ has been on an acquisition spree, becoming the most significant investor in MultiChoice and thereby invoking regulatory mechanisms which necessitate a formal takeover bid. The French company seeks to leverage MultiChoice’s diverse portfolio, especially its live English football match offerings and localized programming which appeal to a wide array of viewers across Africa.
The business gesture by Canal+ resonates with a commitment to perhaps not only retaining but strengthening the Johannesburg Stock Exchange (JSE) listing of MultiChoice as well as honoring transformative initiatives and keeping to the precepts of broad-based Black economic empowerment in South Africa.
Saada emphasized that they envision amalgamating Canal+'s existing operations with MultiChoice to forge a media powerhouse, boasting nearly 50 million subscribers. This synergy aims to propel a significant investment in regional content creation and sports broadcasting - a venture that could set new industry standards for content curation and distribution on the continent.
While the advisors for the deal from the side of JPMorgan Chase & Co. and Bank of America Corp are preparing for the new offer, due by April, MultiChoice has engaged Citigroup and Morgan Stanley to navigate the financial aspects of the negotiation process.
This current gambit by Canal+ could mean a robust infusion of resources into MultiChoice, potentially enabling it to upscale its production capabilities and augment its content library with fresh and compelling African narratives. Moreover, it stands as a testament to the increasing global interest in Africa's digital and media potential and the investment opportunities this growth represents.