Pan-African pay-TV operator Multichoice has turned down a $2.15 billion acquisition offer from French media company Canal+. Multichoice disclosed its decision in a statement to its shareholders on Monday.
According to Techcabal, the MultiChoice statement read, "After careful consideration, the Board has concluded that the proposed offer price of R105 in cash significantly undervalues the Group and its future prospects".
Last week, Inclusion Times reported that French pay-TV giant Canal+ intends to purchase South Africa's MultiChoice entirely in its quest to go from being its top shareholder to becoming the leading pay-TV provider and boosting its scale across Africa.
The recent decision by Multichoice is backed by the company's recent valuation exercise, which revealed that its share unit is worth more than the offered R105 per share. As such, the takeover bid has now reached a roadblock due to undervaluation.
Multichoice has acknowledged that the board is open to all means of maximising shareholder value. The company has also informed Canal+ that its offer does not provide a basis for further engagement at the proposed price.