African television enters a fresh phase
In a significant move, French media giant Canal+ has agreed to acquire a substantial portion of MultiChoice, South Africa's leading pay-TV and streaming service, for approximately $2 billion. The deal, which is subject to final approval from South Africa's Competition Tribunal and the Independent Communications Authority of South Africa (ICASA), marks a major consolidation in Africa’s pay-TV and streaming markets.
A New Entity for Compliance and Empowerment
The acquisition will see the creation of a new entity, LicenceCo, to hold MultiChoice’s South African broadcasting licence. This structure aims to comply with South African laws capping foreign ownership of local broadcasters to 20% voting rights. LicenceCo will be majority-owned by Historically Disadvantaged Persons (HDPs) and workers.
Canal+ will hold a minority foreign stake under this structure, meeting regulatory limits. The economic benefits from the deal are split to preserve black empowerment and local ownership mandates.
Investment in Local Content and Economic Growth
The deal includes a $1.4 billion, three-year investment commitment to local content production, skills development, training, and corporate social responsibility programs. This investment aims to benefit South Africa’s creative sector and economy.
Other conditions mandate no retrenchments for three years and initiatives to promote Black-owned suppliers and boost HDP participation in the audiovisual sector.
A Step Towards Global Competitiveness
Analysts view the merger as reshaping Africa’s media landscape by combining Canal+’s existing 8 million subscribers in 25 countries with MultiChoice’s 19.3 million sub-Saharan subscribers and streaming platform Showmax. The combined entity aims to compete with global streaming giants like Netflix and Amazon Prime.
Regulatory Approval and Implications
The restructuring involves converting existing shareholder stakes into Canal+ shares and reallocating a 26% economic interest to new local stakeholders within LicenceCo to maintain compliance. While the Competition Tribunal has approved the deal, the final step is securing ICASA’s broadcasting licence transfer approval to LicenceCo, which will grant the deal its legal broadcasting right in South Africa.
The deal is closely monitored to safeguard jobs, promote economic empowerment of disadvantaged South Africans, and protect broadcasting competition. ICASA plays a pivotal role in giving final approval to ensure the new entity complies fully with broadcasting laws, foreign ownership restrictions, and local content mandates.
Uber's Revenue Surge and Other Tech News
In other news, Uber has reported a significant revenue growth in the last quarter, generating $4.2 billion. Meanwhile, WhatsApp has implemented a new security update to combat scams. Artificial Intelligence is expanding into blue-collar jobs, and Starlink is planning a new initiative to make rural internet more affordable for underserved communities.
In the world of entertainment, Battlefield 6 will not be fully playable on Xbox Game Pass on release day. MultiChoice, despite losing premium subscribers, is aiming to stay in the game. The sale of a significant portion of its business to Canal+ is a strategic move to keep the regulators happy and bring in new capital.
Sources: [1] TechCentral - https://www.techcentral.co.za/ [2] MyBroadband - https://mybroadband.co.za/ [3] BusinessLive - https://www.businesslive.co.za/ [4] Fin24 - https://www.fin24.com/
- The acquisition by Canal+ of a significant portion of MultiChoice is not restricted to broadcasting, as the deal also includes a commitment of $1.4 billion towards local content production, skills development, and corporate social responsibility programs in the finance sector to empower the South African economy and creative industry.
- The new entity, LicenceCo, resulting from the acquisition, will not only hold MultiChoice’s South African broadcasting licence but also invest in local content production and economic growth, with intentions to compete in the global entertainment market against streaming giants like Netflix and Amazon Prime, marking further developments in the finance, business, and entertainment industries.
