Canal+ takeover offer of R33 billion rejected by Multichoice

The headquarters of Canal Plus, a pay-television unit of Vivendi SA, are seen in Issy les Moulineaux near Paris, France, on Saturday, May 12, 2012. Vivendi SA would stand to boost the lowest valuations of Chief Executive Officer Jean-Bernard Levy's seven-year tenure by breaking up businesses ranging from phone providers to video games and pay television. Photographer: Fabrice Dimier/Bloomberg

MultiChoice has rejected Groupe Canal+’s bid to acquire the company at R105 per share, asserting that the offer undervalues the DStv operator. Canal+ had revealed a non-binding indicative offer last Thursday, seeking to acquire the shares in MultiChoice that it does not already own. The offer, valuing MultiChoice at over R46 billion, included a requirement for Canal+ to pay R32.5 billion in cash for the remaining 64.99% stake.

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In response to Canal+’s proposal, MultiChoice announced on Monday that the French media giant had increased its shareholding in the company to 35.01%. The board, after thorough consideration, expressed dissatisfaction with the suggested cash offer of R105, deeming it a significant undervaluation of the company and its future prospects.

The rejection was grounded in MultiChoice’s recent independent valuation exercise, which assessed the company at a level significantly exceeding the proposed R105 per share. The valuation excluded potential synergies arising from the envisaged transaction, a factor Canal+ had emphasized during their lengthy discussions. MultiChoice insisted that these synergies be considered in any fair offer made by Canal+.

MultiChoice criticized the timing and public nature of Canal+’s announcement, noting that the delivery of the offer letter occurred after over a year of discussions between the two companies. Despite the board’s openness to avenues maximizing shareholder value, it conveyed to Canal+ that the current offer price does not warrant further engagement.

The board affirmed its commitment to act in the best interests of the company and shareholders. It expressed a willingness to engage with any party presenting a fair offer subject to appropriate conditions. Additionally, MultiChoice reiterated its dedication to complying with the applicable provisions of the Takeover Regulations concerning any formal and binding offer, underscoring its commitment to a fair and transparent process.