MultiChoice chair stays on to oversee Canal+ deal

MultiChoice announced today that its chairman, Imtiaz Patel, will stay on as the company’s chairman as it undergoes a potential takeover by French media giant Canal+.

MultiChoice told shareholders this morning that Patel agreed to keep his seat to help the company navigate the buyout offer from Canal+.

This comes after the DStv owner announced in September 2023 that Patel would step down. 

Elias Masilela was set to take over as chair from 1 April 2024.

“The board believes that there is a significant benefit in continuity at this time, and Mr Patel has agreed to extend his tenure until the conclusion of the Canal+ transaction or such sooner date as may be determined in light of progress on the transaction,” the company said.

This comes after Canal+ offered to buy MultiChoice for R125 per share following a ruling by the Takeover Regulation Panel (TRP), upping its initial offer for the company.

MultiChoice and Canal+ released a joint statement on SENS early in March informing shareholders that this comes after further discussions between the two companies.

In February, South Africa’s TRP ruled that Canal+ must immediately make a mandatory offer to buy MultiChoice since its total interest in the company now amounts to 35.01%.

Following this initial ruling, Canal+ said it had applied for an extension, and the panel had extended the time period by 25 business days. 

Therefore, Canal+ was required to publish a firm intention announcement by no later than Monday, 8 April 2024.

According to South Africa’s Takeover Regulations, the minimum price for the mandatory offer is approximately R105 per MultiChoice ordinary share.

However, the companies said early in March that 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+ intend to mutually cooperate in this regard. Accordingly, MultiChoice will give customary exclusivity undertakings to Canal+,” the companies said.

MultiChoice said that an independent board will be constituted and, after receipt of an independent expert’s opinion, provide its opinion and recommendation on the offer.

On 1 February 2024, Canal+ made a voluntary, non-binding offer to buy MultiChoice for R105 per share. This offer was made before Canal+’s total interest in MultiChoice surpassed the 35% mark.

This offer of R105 per share was a premium of 40% to MultiChoice’s closing share price of R75 on 31 January 2024.  However, MultiChoice rejected this offer, saying R105 per share significantly undervalues the company.

Since the start of this year, MultiChoice’s share price has risen by almost 40%.