MultiChoice enters new phase on JSE | Media Investment | Business
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After a decision taken in September 2018 by owners Naspers to spin-off the African pay-TV giant, MultiChoice Group (MCG) has listed on the Johannesburg Stock Exchange.

multichoice africa 5 Dec 2017MCG claims to be one of the fastest growing multi-platform pay-TV broadcast providers globally, with a 30-year track record and currently brings local and international entertainment and sport content to around 14-million households in 50 African markets, providing viewers with access to content from eight out of ten major international studios.

The group’s JSE entry, regarded by the firm as an important milestone in its growth journey, includes MultiChoice South Africa (MCSA), MultiChoice Africa Holdings (MAH), Showmax as well as security provider Irdeto and all of its subsidiaries.

In a fiercely competitive African content market, MCG says that it is differentiated by its production of over 4,500 hours of local content in ten studios across Africa. Its Showmax business alone has 17,500 hours of content with half being local content while it also boasts over 37 sports channels providing sports fans viewership of most iconic global sport events.

MCG says that while it continues to drive incremental mass-market growth in its South African base, the business on the rest of the continent has stabilised with a value strategy driving operational and financial improvements. It sees meaningful scope to drive up pay-TV penetration in the rest of Africa in the mid to mass market while the connected video services represent a fast-growing, longer-term opportunity.

The company sees the listing and impending unbundling of it by Naspers reinforces the commitment of both MCG and Naspers to broad, socio-economic transformation in South Africa.

“As one of the fastest growing pay-TV broadcast providers globally, our strong financial position at listing is backed by attractive long-term growth opportunities in both subscriber numbers and revenue,” commented Group CEO Calvo Mawela. “MCG has a highly cash generative core with no financial debt, and we are poised to deliver value to our shareholders over time.”

As stated in the original plan in September 2018, the move also creates additional value for Phuthuna Nathi, a black economic empowerment initiative, with Naspers allocating an additional 5% stake in MultiChoice South Africa to the initiative’s shareholders for no additional consideration. This would increase Phuthuna Nathi’s stake in the South African unit to 25% and result in a 25% increase in PN’s share of MultiChoice dividend flows. Phuthuma Nathi (PN) shareholders will be allocated an additional 5% stake in MultiChoice South Africa (MCSA) for no consideration, thereby increasing their indirect interest in MCSA from 20% to 25%.

“Listing MultiChoice Group through an unbundling unlocks value for Naspers shareholders by creating the opportunity for them to own a direct stake in MultiChoice Group, a top-40 JSE-listed African entertainment group,” added Naspers chief executive officer Bob van Dijk. "As MultiChoice Group embarks on its next exciting chapter I look forward to seeing the team build further on its impressive success story.”