Fox Corporation has agreed to buy Roku in a cash-and-stock deal valuing the streaming platform at about $22 billion, or $160 a share.
Under the terms, Fox will pay Roku shareholders $96 in cash and 0.9693 shares of Fox Class A stock for each Roku share. Based on Fox’s reference price of $66.03, the stock portion is valued at $64 a share.
The transaction would leave Fox shareholders with about 73% of the combined company and Roku shareholders with about 27%.
Fox said the deal is expected to generate about $400 million in annual run-rate cost synergies, with additional revenue upside. The company also said it expects the acquisition to be accretive to free cash flow per share by the second full year after closing.
On the balance sheet, Fox said it expects pro forma net leverage of about 2.8 times at closing, including 50% credit for the projected cost synergies. To fund the cash portion of the purchase, Fox has secured $12 billion of fully committed bridge financing.
Roku brings more than 100 million global streaming households into the combination, including more than half of U.S. broadband households. Fox said the merged company would become the third-largest player in U.S. television by share of viewing.
The deal is expected to close in the first half of 2027. Anthony Wood will remain involved with the combined company and join Fox’s board after closing. The market has reacted to these announcements by moving the company's shares -17.23% to a price of $54.505. Check out the company's full 8-K submission here.
