Regulators approve Canal+’s acquisition of MultiChoice with strict conditions

The news

• South Africa’s Competition Commission has recommended the approval of Canal+’s R55bn acquisition of MultiChoice, subject to several public interest conditions.
• Conditions include commitments to employment, local content investment, and increased ownership by historically disadvantaged persons (HDPs).
• A new entity, LicenceCo, will be created to hold MultiChoice’s South African broadcasting licence, majority-owned by HDPs to comply with foreign ownership laws.
• The deal still requires approval from the Competition Tribunal and other regulatory bodies.

French media conglomerate Canal+ has moved closer to acquiring South African pay-TV giant MultiChoice, following a recommendation from South Africa’s Competition Commission to approve the R55 billion ($2.9 billion) deal, albeit with stringent conditions aimed at safeguarding public interest.

The Commission’s endorsement is contingent upon commitments by Canal+ and MultiChoice, including addressing employment concerns, ensuring the continued operation of the merged entity from South Africa, and promoting local content.

Additionally, the deal mandates increased shareholding by historically disadvantaged persons (HDPs) and workers in entities like Orbicom and the newly proposed LicenceCo. LicenceCo will be established to hold MultiChoice’s South African broadcasting licence, ensuring compliance with the Electronic Communications Act, which restricts foreign entities from owning more than 20% of a local broadcasting licensee’s voting rights.

This entity will be majority-owned by HDPs, including Phuthuma Nathi, Identity Partners Itai Consortium, Afrifund Consortium, and a Workers’ Trust, while MultiChoice Group will retain a 49% economic interest and 20% voting rights in LicenceCo.

The Commission also emphasised the importance of maintaining a plurality of television news and promoting South African content in new markets. Supplier development commitments and procurement targets from small and Black-owned companies are also among the stipulated conditions. Furthermore, the merger parties have agreed to a moratorium on retrenchments for three years following the merger’s implementation date.

This development mirrors challenges faced by other foreign companies, such as Elon Musk’s Starlink, which has struggled to enter the South African market due to similar ownership requirements.

Starlink has been unable to launch in South Africa due to the country’s Black Economic Empowerment (BEE) laws, which require 30% local ownership for telecom operators. Musk has publicly criticised these requirements, claiming they are discriminatory. However, the government appears to be relaxing its stance.

The Competition Commission’s recommendation is a significant step forward for Canal+’s acquisition of MultiChoice. However, the deal still requires approval from the Competition Tribunal and other regulatory bodies before it can be finalised. Both companies have expressed confidence in meeting the necessary conditions and completing the transaction by the extended October 8, 2025, deadline.

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