French pay-TV giant buys bigger stake in DStv-owner MultiChoice

MultiChoice has informed shareholders that Groupe Canal+ has increased its stake in South Africa’s biggest pay-TV player to 26.26%.

This is up from 20.12% in July when MultiChoice disclosed that the French media giant had bought a significant chunk of its ordinary shares.

Seeing Canal+ buying up MultiChoice shares on the open market has caused speculation that Vivendi, through Canal+, could be looking to strike a deal with Africa’s pay-TV giant.

Vivendi is most likely eyeing MultiChoice Africa, which has around 12.8 million subscribers.

It tried to acquire MultiChoice Africa in 2017, but Naspers, MultiChoice’s parent company at the time, reportedly rejected the $1 billion offer.

In June, MultiChoice revealed that Canal+ increased its stake in MultiChoice to 18.44%.

Before that, in September 2021, Canal+ increased its stake in the company from 12% to over 15%.

“MultiChoice remains committed to acting in the best interests of all shareholders and to create sustainable long-term shareholder value,” the company said in its statement to shareholders on Wednesday.

“While the Group regularly engages investors and maintains an open dialogue with the investment community, its policy is not to comment on its individual shareholders nor on its interactions with them.”

MultiChoice CEO Calvo Mawela said in June they have monthly interactions with Vivendi and that the French media company likes MultiChoice, its management, and its prospects.

Mawela said their relationship with Canal+ is growing, and they are working together on many products, including content co-productions and sub-licensing.

Protea Capital Management senior investment analyst Richard Cheesman previously said they see opportunity, means, and motivation for Canal+ to buy a larger stake in MultiChoice.

“There is little geographical overlap between MultiChoice and Canal+ in Africa, and there would be many synergies from a merger such as content costs, satellite leases, and perhaps expediting the use of the MultiChoice tax losses,” Cheesman said.

“MultiChoice and Canal+ have monthly feedback meetings and have collaborated on some content. We view this as informal due diligence being done.”

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French pay-TV giant buys bigger stake in DStv-owner MultiChoice