French-based media giant Canal+ has increased its offer to buy out South African video entertainment group MultiChoice.
Last month, Canal+ confirmed it had submitted a letter to MultiChoice’s board of directors, containing a non-binding indicative offer to acquire all of the issued ordinary shares of MultiChoice that it does not already own, subject to obtaining the necessary regulatory approvals.
It offered a cash consideration of R105 per MultiChoice ordinary share.
However, MultiChoice rebuffed the offer, saying it undervalued the company, before asking the French-based firm to sweeten the deal.
In a turn of events, last week South Africa’s Takeover Regulation Panel (TRP) ordered Canal+ to make a “mandatory offer immediately” for it to acquire shares that it does not already own in DStv operator MultiChoice.
This, after MultiChoice had requested the TRP to make a ruling on whether a mandatory offer by Canal+ was required to be made to all holders of ordinary shares in the company under section 123 of the Companies Act.
The TRP contended that the announcement without the approval of the TRP was unlawful, being in contravention of the Act and the regulations, and issued a compliance notice against MultiChoice.
MultiChoice and Canal+ today issued a joint statement, stating: “While the minimum price for the mandatory offer in terms of Regulation 111(2) of the Takeover Regulations is approximately R105 per MultiChoice ordinary share, Canal+ has agreed to increase the price to make the mandatory offer at a cash consideration of R125 per MultiChoice ordinary share.”
MultiChoice and Canal+ say they intend to mutually co-operate in this regard. Accordingly, MultiChoice will give customary exclusivity undertakings to Canal+. Once the mandatory offer is made, the independent board of MultiChoice will be constituted and will, after receipt of the independent expert’s opinion, provide its opinion and recommendation on the mandatory offer in accordance with Regulation 110 of the Takeover Regulations.
“Nothing in this announcement should be read as limiting in any way the giving of such opinion,” says the video entertainment group.
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