The bid to take over majority shares of leading entertainment company, MultiChoice Group by French firm, Vivendi SE’s Canal, has hit the rocks with MultiChoice noting that the proposed price undervalues its business.
It should be recall that the French company last week made a move to buy 61% share under its proposed offer price of 105 rand ($5.55) per share in cash amounting to $2.5bn, but the company while rejecting the offer said it “significantly undervalues the group and its future prospects.”
It said an evaluation it recently conducted showed the MultiChoice Group significantly above 105 rand a share.
The Canal+ valuation excluded the synergies that a potential deal will offer.
Canal+ is already the biggest shareholder with 35.01 per cent share, passing the threshold for triggering a mandatory offer.
MultiChoice said in a separate statement on Monday that it had filed a notice with South Africa’s Takeover Regulation Panel and asked it to rule on whether such an offer must be made to all shareholders.
Its statement read in part: “The MultiChoice board remains open to engage with any party in respect of any offer which is for a fair price and is subject to appropriate conditions.”