Naspers mulls sale of Multichoice as viewers switch to online alternatives
Naspers and MTN Group are reportedly in talks on a deal for Multichoice Africa, although no agreement has been reached.
Naspers, Africa’s largest company by market capitalization, is considering the sale of its pay-TV business – Multichoice Africa – owing to sluggish economic growth in key markets and the growing trend of viewers switching to online alternatives, according to a Bloomberg report on Thursday.
People familiar with the matter said a disposal of Multichoice will not include its highly profitable South African division. A final decision hasn’t been reached and a sale is only one of the options being considered, the sources said.
Naspers and MTN Group, Africa’s largest mobile operator, are reportedly in talks on a deal for Multichoice Africa, although no agreement has been reached.
The sale of Mutichoice Africa would further move Naspers away from its traditional media businesses, which includes newspapers and MultiChoice’s DSTV satellite-TV service, according to Bloomberg.
Naspers has been transitioning into a serial investor in internet companies around the world due mainly to the success of its investment in Chinese internet giant, Tencent, where the Cape Town-based company’s stake is worth $107 billion.
In its 2016 half-year ended in September, Naspers reported that its internet division accounted for 72 percent of its total revenue of $6.8 billion. But the company reported that its television and entertainment unit – which encompasses Multichoice – was impacted by weak currencies across the continent even though total subscribers reached 11 million. As a result, the division posted an 8 percent drop in revenue to $1.6 billion, while trading profits fell 43 percent to $226 million.
With a valuation of about $90 billion, Naspers is a global internet and entertainment company with operations in 130 countries. The company has made investments in internet companies, including Konga, a Nigeria-based online retailer; and OLX, a classifieds website.
Most Popular News
- Details of President Muhammadu Buhari's "Budget of Change"
- Fundamentals that every new forex trader should be aware of
- Nigeria, Morocco sign agreements on regional gas pipeline, chemical plant
- FDI to Africa falls by 21 percent, says UNCTAD 2018 World Investment Report
- Ivory Coast and Ghana set to harmonize sales strategy for cocoa
- Inflation continues downward trend, drops to 11.61 percent in May