MultiChoice, Africa’s leading pay-TV operator, has announced that its shareholders are encouraged to accept a $2.9 billion buyout proposal from French media giant Canal+.
If successful, this acquisition will see the Bolloré family’s Vivendi, which owns Canal+, taking control of DSTV, Showmax, GoTV, and several sports broadcasting licenses across Africa. This move is poised to significantly reshape the paid TV landscape on the continent.
Vivendi, a renowned mass media and communications conglomerate headquartered in France, owns Canal+, the company behind the MultiChoice bid. The Bolloré family, a notable French billionaire dynasty with roots in port, logistics, and shipping, owns Vivendi. Canal+ itself is a substantial media entity, generating around €9.6 billion in revenue, which is roughly 3.2 times that of MultiChoice.
With an existing foothold in Africa’s French-speaking regions through Canal+, which boasts 7.6 million subscribers, Vivendi has been steadily increasing its influence on the continent. MultiChoice, with 22 million subscribers, represents a significant expansion opportunity.
This acquisition aligns with Vivendi’s strategic pillars of transformation, internationalisation, and integration. The company is seeking growth beyond the relatively stagnant European market and views Africa, with its promising growth potential, as a strategic target. The continent is expected to have the world’s largest labor force by 2050, presenting a lucrative long-term investment opportunity.
Despite some challenges, including MultiChoice’s declining stock price and increased competition from international players, the acquisition offers Vivendi a chance to dominate Africa’s pay-TV market. Additionally, partnerships like MultiChoice’s recent collaboration with Comcast’s NBC Universal and Sky for Showmax underscore the strategic value of this acquisition.
However, regulatory hurdles remain. South Africa’s Electronic Communications Act restricts foreign ownership in local broadcasting to a maximum of 20% voting rights. Canal+ and MultiChoice are exploring structuring options to comply with these regulations while maintaining MultiChoice’s black ownership credentials under South Africa’s empowerment laws.
Vivendi is committed to navigating these challenges and addressing concerns about potential perceptions of French imperialism in Africa. The company aims to respect and preserve MultiChoice’s local ownership credentials while expanding its influence.
The outcome of this deal remains uncertain, pending regulatory approval and structural adjustments. For now, consumers are unlikely to see immediate changes, though the MultiChoice management team faces a complex transition.
Analysis by
Iwuchukwu Chukwudi
