New twists and turns in the CANAL+ MULTIVISION soap opera
Following the submission on February 1 of a "non-binding indicative" offer from CANAL+ to the MultiChoice Board of Directors, the latter stated in a press release: "While the Board of Directors is open to all means of maximizing shareholder value, it has informed Canal+ that, at the proposed price, the letter does not constitute a basis for further negotiation."
It should be noted that Canal+ had made an offer representing a premium of 40% over the share price at the close of trading on the day before the proposal. This amounted to ZAR 105 per share, compared with ZAR 75 per share at the close of trading on the Johannesburg Stock Exchange on the day before the offer.
MultiChoice said it recently conducted an exercise that valued the company "well above R105 per share" and argued that this valuation excluded synergies that could arise from Canal+'s acquisition of the company.
The South African group also states that "the board of directors remains open to engagement with any party regarding an offer at a fair price." Furthermore, South African law stipulates that "a foreigner may not, directly or indirectly, exercise control over a local commercial broadcasting license holder."
However, MultiChoice said in a separate statement that Canal Plus, which held a 31.67% stake in MultiChoice on Thursday, had increased its stake to 35.01% following the announcement of its offer.
This 35% threshold requires CANAL+ to make a mandatory offer under South African law.
For this reason, MultiChoice has stated that it has filed a notice with the country's takeover committee to decide whether a mandatory offer should be made to all common shareholders.
The French group said that, subject to a confirmatory audit, it would submit a firm offer to MultiChoice's board of directors.
Canal+ also stated that parent company Vivendi was preparing to go public as a separately listed company, allowing investors to benefit directly from the merger with MultiChoice, and said that one of the objectives of the acquisition would be to be listed on the South African stock exchange.
The acquisition of MultiChoice, which operates in English-speaking markets, would make Canal+, which operates pay-TV services in French-speaking African countries, the leading player in the African pay-TV market.