Canal+ gives Multichoice little choice with improved $2.9bn buyout bid

Struggling to balance its business books amid drop in subscriber numbers as many run to streaming service, Multichoice appears to have little choice with the new offering on the table

French media giants Canal+ has given Multichoice little or no choice with an improved offer of $2.9bn (about Shs11 trillion) to fully acquire South African broadcasting company.

In February, Canal+ offered $1.7bn to eat up the entirety of Multichoice seeking to grow its 35-percent shares in the company to 100 percent.

The South African broadcaster's board balked at the initial offer, saying it undervalued the company.

But the latest offer is being seen as more attractive for Multichoice. The South Africans appear to be operating with turbulence amidst the boom in streaming services.

Maxime Saada, chairman and CEO of Canal+, told Reuters last week that the French company had engaged with the board of Africa's biggest pay-TV company to determine a reasonable price that would lead them to resume talks.

"It was clear that at that price we would get management and board support," Saada said, adding that the new price offered "a fair value".

Multichoice’s shares climbed 25 percent since Canal+ first announced its plan to purchase the broadcaster in February.

Canal+ had been given until today, Monday April 8, to table its offer and it is understood Multichoice has now set up a board to review the new offer.

Multichoice is Africa's largest provider of pay TV services, with up to 21.8 million subscribers largely on its premier offer, DStv, and streaming service Showmax.

In January, Multichoice appeared to reel from the turbulence as the Africa Cup of Nations (Afcon), one of its most valued continental staple, was nowhere on its menu until some eleventh-hour paperwork was dotted and signed.

Afcon tournaments are usually advertised with relish across DStv platforms but the last edition in Ivory Coast was a dead leaf.

However, Canal+ appears to be aggressive to take over the African continent where they have served for over 30 years across 25 countries - the majority of them in West Africa and other French-speaking markets.

Observers like James Muhire, a Canal+ subscriber in Rwanda, says the challenge for the French broadcaster is how best they will integrate English into their programming.

Nearly 80 percent of Multichoice's 21.8 million subscribers are purely Anglophone in countries like Nigeria (its biggest market share), Ghana, Uganda, Kenya, Tanzania, Zimbabwe and Zambia.

The intended acquisition of Multichoice is part of Canal+'s strategy to expand its presence on the continent beyond West African and French-speaking countries.

Hit hard by streaming services and decline in subscriber numbers, Multichoice has been raising subscription for its DStv offerings in several markets on the continent, including Uganda.

Just last week, DStv Uganda raised its subscription to Shs290,000 per month for premium content, up from Shs275,000 that it arrived at six months ago.

Other packages such as Compact-Plus and Compact also increased by Shs10,000 to Shs6,000.

For many, the question on why Canal+ would be investing so much in the acquisition of a seemingly sinking company begs answers.

But Canal+ is probably looking at the market share and monopoly that comes with it.

With exclusive rights to some of the major leagues such as Premier League and major tournaments, it would look like a boon.

That is until streaming reality comes in with the bane.