Canal Plus Directed to Extend Offer by South African Regulatory
The South African takeover panel has issued a mandate directing French media company Groupe Canal+ SA to promptly make a mandatory offer to acquire the remaining shares of pay-TV company MultiChoice (MCGJ.J), according to an announcement made by MultiChoice on Wednesday.
This development stems from Canal Plus, the primary shareholder, expressing its intention earlier this month to acquire the outstanding shares of MultiChoice. At the time of the offer, Canal Plus held a 31.67% stake, which subsequently increased to 35.01%, surpassing the critical 35% threshold that triggers the mandatory offer requirement. Despite the increase, MultiChoice’s board rejected Canal Plus’s 105 rand per share offer, asserting that it significantly undervalued the company.
The Takeover Regulations Panel (TRP) stepped in, ruling that Canal Plus must expeditiously adhere to the requirements of the Companies Act and related regulations by initiating a mandatory offer for the remaining MultiChoice shares. This decision follows Canal Plus’s argument that it was not obliged to make such an offer, citing restrictions outlined in MultiChoice’s memorandum of incorporation. The memorandum limits foreign companies from holding more than 20% of the broadcaster’s voting rights.
This ruling underscores the significance of regulatory oversight and the adherence to takeover regulations in South Africa. The emphasis on ensuring fairness and transparency in corporate transactions is evident in the TRP’s intervention. The unfolding events will undoubtedly capture the attention of investors and market observers keen on understanding how Canal Plus will respond to this mandate. Additionally, the prospect of negotiations between the parties leading to an acceptable resolution adds an element of intrigue to the situation. As stakeholders await further developments, the impact of this regulatory decision on MultiChoice’s future and the broader corporate landscape will be closely monitored.
