South Africa’s Takeover Regulation Panel (TRP) has ordered French media giant Canal+ to make a “mandatory offer immediately” for it to acquire shares that it does not already own in DStv operator MultiChoice.
This, after Canal+ in early February 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.
The French company made an indicative offer of R105 per share in MultiChoice, saying this would represent a premium of 40% to MultiChoice’s closing share price of R75 on 31 January 2024.
MultiChoice has since turned down the R105 per share offer from Canal+, saying it had significantly undervalued the Randburg-headquartered firm.
Given the TRP ruling, the ball is firmly in Canal+’s court to submit an offer acceptable to shareholders, or risk being frozen out for 12 months, as per the regulation.
Video entertainment group MultiChoice says it received formal notification that Canal+ had acquired an additional interest in the ordinary shares of the company, such that the total interest in the ordinary shares held by Canal+ amounted to 35.01% of its total ordinary shares in issue.
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.
According to the DStv operator, this compliance notice is the subject matter of an appeal and a review instituted by MultiChoice to the Takeover Special Committee.
“Shareholders are advised that the TRP issued a ruling on 27 February 2024, to the effect that Canal+ has acquired 35.01% of the voting rights in MultiChoice and, accordingly, a mandatory offer in terms of section 123 of the Act has been triggered.
“Canal+ is, therefore, required to make the mandatory offer immediately, in line with the requirements of the Act and the regulations,” MultiChoice adds.
MultiChoice notes this ruling is given only in respect of the takeover provisions. Further, in issuing this ruling, the TRP did not consider the commercial advantages or disadvantages of the transaction in accordance with section 201(3) of the Companies Act, it adds.
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