How MultiChoice Benefits From The Hostile Takeover By Canal+?

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Canal+ has managed to have upped its stake in MultiChoice to 45% home to brands like SuperSport, M-Net, DStv and GOtv which is awaiting regulatory approval. With both parties that will be spending the rest of 2024 looking to assess a possible structure as Canal+ being a foreigner has to navigate the restrictions to foreign ownership.

The likely scenario here is that MultiChoice Africa will be managed by Canal+ with existing shareholders voting rights being reduced as they will be in charge of the services within South Africa. Residing within Kenya, Malawi and Nigeria, MultiChoice Africa offers brands such as Africa Magic, Zambezi Magic and Maisha Magic.

With Canal+ obtaining a 20% stake in MultiChoice South Africa which is the maximum amount a foreigner can get of a local company. It's possible that shareholders may look to increase Canal+ influence over MultiChoice Africa by 80% or at least on the content side.

Canal+ had outlined that they don't believe in the diversity of MultiChoice which consists of brands like Namola, Irdeto and BetKing. So with them handling the content portion of MultiChoice could free up some potential income for other shareholders to manage those other fields MultiChoice is hoping to cash on e.g. Showmax.

MultiChoice had been pumping funds onto SuperSport and with Canal+ still viewing linear TV as an asset we could see them manage part of the expenses giving them as much ownership of the brand. This was likely the most stressful of subsidiaries by MultiChoice and Canal+ would save them money. 

If anything, the burning question is how many of these subsidiaries MultiChoice will continue to operate under their wing cause with them complying with BEE those partners may not want to support some of these ventures leading some to potentially close if not getting sold off.