MultiChoice has announced a significant funding boost for its streaming platform, Showmax, as part of its strategic partnership with Comcast Corporation’s subsidiary NBCUniversal Media, LLC (NBCU), and Sky. This collaboration aims to position Showmax as the leading streaming service in Africa.

NBCU, a subsidiary of Comcast, has acquired a 30% equity stake in Showmax Africa Holdings Limited (SMAH), the holding company for Showmax operations. The deal includes ongoing support through the licensing of Comcast’s Peacock platform and content from NBCU, Universal Pictures, Peacock, and Sky.

MultiChoice, through its wholly owned subsidiary, MultiChoice Group Holdings B.V. (MGHBV), and NBCU are jointly providing funding to SMAH during its investment phase. This funding, contributed in proportion to their respective shareholdings, will continue to support Showmax’s growth and development. Profits will be shared on the same basis in the future.

Funding is provided as needed, based on SMAH’s working capital requirements and budget, subject to a maximum capped amount. As of March 31, 2024, MGHBV and NBCU have contributed a total of $120 million in equity funding to SMAH, in line with their respective shareholdings.

Since April 1, 2024, an additional $164 million has been provided, further solidifying the partners’ commitment to Showmax’s expansion. .

Showmax’s financial performance was disclosed in MultiChoice’s year-end results and financial statements released on SENS on June 12, 2024, and the business remains consolidated into MultiChoice’s financials in the normal course.

This strategic funding and partnership will enable Showmax to continue growing its footprint across Africa, providing a diverse range of content to a broad audience and competing more effectively in the continent’s dynamic streaming market.

Picture: REUTERS

MultiChoice, led by Calvo Mawela, seems steadfast in transforming the satellite TV service into a tech-centric company. However, this strategy may not align with the intentions of its suitor, Canal+.

The French media giant has offered R125 in cash for every MultiChoice share it does not already own and has invested nearly €1.2bn for a 45.2% stake in the company.

Maxime Saada, chair and CEO of Canal+, has remarked: “Almost one of the only differences” between Canal+ and MultiChoice is the latter’s “belief in diversification”.

In a recent meeting with journalists in Johannesburg, Saada emphasised Canal+’s focus on content distribution as its core business. When asked if Canal+ would divest MultiChoice’s noncore businesses, Saada indicated it was too early to decide until due diligence was completed.

Meanwhile, MultiChoice continues to advance its strategy to develop its platform beyond pure video entertainment. On Tuesday, it announced plans to sell a 60% stake in its insurance business, NMS Insurance Services (NMSIS), to Sanlam Life for R1.2bn, with a potential performance-based earn-out of up to R1.5bn by December 2026.

This deal includes a long-term commercial arrangement to expand insurance offerings to MultiChoice’s 21-million household subscriber base across 50 African countries. Sanlam will manage NMSIS operations through its Sanlam Fintech cluster.

In February, MultiChoice sold a 30% stake in its video-on-demand platform, Showmax, to US-based Comcast, which helped to develop the new Showmax platform. This move, in particular, raises questions such as: will Canal+ buy Comcast’s stake in Showmax or collaborate with it?