South Africa Grants Approval for Canal+ MultiChoice Agreement, Subject to Certain Terms and Conditions
In a significant move that could reshape Africa's media landscape, French media giant Canal+ is one step closer to fully acquiring South African pay-TV broadcaster MultiChoice. The Competition Commission of South Africa has recommended the approval of Canal+'s R55 billion takeover of MultiChoice, subject to certain public interest conditions.
The proposed deal, worth approximately R35 billion ($1.96 billion), values MultiChoice at around R55 billion ($3 billion). Canal+ offered R125 ($6.97) per share for MultiChoice, a move that highlights its long-term ambitions in Africa's media and streaming market.
The acquisition, if approved, will bring Canal+ closer to fully acquiring MultiChoice. However, the final ruling on the takeover will be issued by the Tribunal, which will consider the Competition Commission's recommendation before issuing a final decision.
To safeguard local interests and comply with national laws, South Africa's Competition Commission has set specific public interest conditions for the takeover. These conditions aim to ensure compliance with South African ownership laws, protect local economic interests, and maintain media plurality in the broadcasting sector.
One of the key conditions is the creation of LicenceCo, a new entity that will hold MultiChoice's South African broadcasting licence. LicenceCo is required to be majority-owned by a consortium of historically disadvantaged persons (HDPs), including groups like Phuthuma Nathi, Identity Partners, Afrifund, and a Workers’ Trust. This structure adheres to the Electronic Communications Act, which limits foreign ownership in broadcasting license holders to a maximum of 20% voting rights.
MultiChoice will retain a 49% economic interest and exactly 20% voting rights in LicenceCo, adhering to the law that caps foreign voting power and protects South African control over broadcasting. The conditions also aim to safeguard South African employment, promote economic inclusion, particularly benefitting historically disadvantaged groups, and preserve the integrity and plurality of South Africa’s broadcasting sector.
The approval is also conditional on ICASA’s final approval of the broadcast licence transfer, a crucial step before the deal can be closed. The conditions collectively ensure compliance with South African ownership laws, protect local economic interests, and maintain media plurality in the broadcasting sector.
The takeover, if approved, could potentially reshape Africa's media landscape, as Canal+ moves closer to fully acquiring MultiChoice. The decision on the takeover by the Tribunal will be a significant step in determining the future of Africa's media landscape.
The proposed acquisition by Canal+ of MultiChoice, worth approximately R35 billion ($1.96 billion), reflects its long-term ambitions in the African business and finance sector, particularly in the media and streaming market. To safeguard local interests and comply with South African laws, specific public interest conditions have been set for the takeover, such as the creation of LicenceCo, a new entity that will hold MultiChoice's South African broadcasting license, and must be majority-owned by a consortium of historically disadvantaged persons (HDPs), serving as an example of how business and finance decisions can contribute to economic inclusion and media plurality in South Africa's broadcasting sector.
