French media conglomerate Groupe Canal+ has expanded its stake in DStv owner MultiChoice to 40.01%. MultiChoice notified shareholders of Canal+’s increased shareholding in a statement on the JSE news service on Friday.
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Shareholders have raised concerns about whether Canal+ might exceed the 50% shareholding threshold. MultiChoice clarified that crossing this threshold would constitute a merger under the Competition Act and would require approval from the Competition Tribunal.
The company also emphasized that if Canal+ purchases shares at a price higher than R125 each, it would need to adjust its offer price accordingly. The French media conglomerate made its formal mandatory offer last month after surpassing the 35% threshold set by South Africa’s Companies Act.
MultiChoice appointed Standard Bank as an independent expert to review the terms of the offer, as required by South African takeover regulations. The independent board includes MultiChoice directors Deborah Klein, Dr. Fatai Sanusi, Louisa Stephens, and Andrea Zappia, who must assess the offer and advise MultiChoice shareholders.
The company also disclosed that Canal+ has continued acquiring shares in MultiChoice. By April 5, 2024, Canal+ had raised its stake from 35.01% to 36.6% and reserved the right to continue purchasing MultiChoice shares in the open market during buyout negotiations.
MultiChoice stated that any additional acquisitions by Canal+ during the offer period at a price higher than R125 would necessitate an increase in the offer price. Canal+’s incremental takeover of MultiChoice began in 2020.
Initially, Canal+’s shareholding exceeding 20% raised concerns about potential violations of South Africa’s Electronic Communications Act (ECA), which restricts foreigners from exercising control or holding financial interest exceeding 20% in a commercial broadcasting licensee.
However, MultiChoice dismissed these concerns, citing compliance with the ECA through limitations in its memorandum of incorporation, which caps collective voting rights for foreigners at 20%.
