Fox is purchasing Roku in a $22 billion deal; the Rangers Sports Network is reportedly interested in local NBA broadcast rights; and the DOJ investigation of Paramount-WBD merger reportedly closed as career lawyers were leaning towards recommending a lawsuit. Plus news on the FIFA World Cup, ESPN, NBC Sports and the World Series of Poker.
Fox to purchase Roku in $22 billion deal
Fox Corporation on Monday announced a deal to purchase the streaming media business Roku as part of a cash-and-stock transaction that assigns the latter company an enterprise value of about $22 billion. The deal for $160/share will bring Fox networks, the Tubi platform and Roku under the same roof, something that Fox executive chair/CEO Lachlan Murdoch called “a natural extension of the deliberate and focused strategy” the company has “been executing for nearly a decade.” Once the business combination closes, which is expected to close in the first half of 2027, shareholders of Fox will own 73% of the company, and those of Roku will hold the remaining 27% interest.
The transaction is expected to generate $400 million in “run-rate cost synergies” and create an entity with net leverage of “approximately 2.8x.” This is significantly lower than the net debt-to-EBITDA ratio of 4.3x “on a synergized basis” expected out of Paramount’s impending acquisition of Warner Bros. Discovery in a $111 billion deal. Fox is paying $96/cash and 0.9693 shares of its company Class A common stock for all outstanding Class A and B shares of Roku “immediately prior to the effective time of the merger.” It should be noted that Fox secured a $12 billion loan for the deal from Morgan Stanley Senior Funding.
Roku chairman/CEO Anthony Wood will be added to the board of directors at Fox Corporation and “have an ongoing role at the combined company” as well. In a statement, Wood explained that the company’s board of directors “unanimously determined after concluding its…