Groupe Canal+, the French pay-television company owned by Vivendi, has again increased its stake in MultiChoice, the parent of DStv, and has now acquired more than 30% of the JSE-listed broadcaster’s equity, according to a regulatory filing.
MultiChoice said on Friday in a statement issued via the JSE’s stock exchange news service that Canal+ has increased its stake to 30.3% of the total ordinary shares in issue.
Canal+ has steadily been buying shares in MultiChoice since 2020. Last September, it ramped up its buying, increasing its stake from 20.1% – disclosed last July – to 26.3%.Canal+ previously told MultiChoice that it views the stake as a financial investment
The move once again raises questions about Canal+’s ultimate intentions, specifically whether it plans to make an offer to MultiChoice’s minorities – a move that could be difficult to execute given South Africa’s restrictions around the foreign ownership of broadcasters.
“Whether it’s Canal+ or someone else, we have a responsibility as directors of the company to do what is in the best interests of shareholders,” MultiChoice Group chief financial officer Jacobs told TechCentral in an interview in November 2020.
“Whatever opportunity comes our way, we will try to keep an open mind. We will certainly look at it and say, ‘Is this is in the best interest of shareholders or not?’ If it is, we’d need to embrace it and make the best deal we can for shareholders,” Jacobs said.
Canal+ previously told MultiChoice that it views the stake as a financial investment. The two companies have worked together for years, sharing content between their respective markets.
At face value, the latest disclosed stake appears to be higher than what’s permitted under South African legislation, which limits foreign ownership of South African broadcasters to 20%.
However, MultiChoice signalled in its statement on Friday about Canal+’s increased stake that it will remain compliant with the rules around foreign ownership.
It explained that a provision in its memorandum of incorporation permits it to reduce the voting rights of shares so that the aggregate voting power of shares held by foreigners is kept below 20% of the total voting power in the company.
“This is to ensure compliance with certain statutory requirements applicable to South Africa,” it said. For this purpose, MultiChoice will assume all shares deposited under an American Depository Receipts programme are held by foreigners, regardless of their actual nationality. Also, all shareholders with an address outside South Africa will deemed to be foreigners unless they can prove otherwise.