Fox shakes up connected TV, streaming space with finalised $22bn Roku deal

Fox Corporation has completed its US$22bn acquisition of Roku, bringing the streaming company’s connected TV platform together with Fox’s portfolio of news, sports and entertainment businesses.

Lachlan Murdoch

Fox Corp

The deal, first announced in June, creates a combined media and tech business spanning Roku’s platform, which reaches more than 100 million households, and Fox’s broadcast, cable, studio and streaming operations.

Fox said it expects to generate about US$400m in annual cost synergies within two years of closing, with further potential revenue opportunities.

Roku shares will cease trading on NASDAQ today. After the acquisition, Roku will continue to operate as an open platform, retaining its relationships with third-party content providers, Fox said.

Roku founder Anthony Wood will join Fox’s board and become co-chair of the newly created Fox Digital Platforms division, alongside Paul Cheesbrough, who will serve as co-chair and CEO.

The division will bring together Roku, free, ad-supported streaming service Tubi, Fox One, Red Seat Ventures and other digital products and services.

Under the terms of the transaction, Roku shareholders received US$95.30 in cash and 0.9799 shares of Fox Class A common stock for each Roku share held at closing. Fox shareholders now own about 74% of the combined company, with former Roku shareholders holding the remaining 26%.

“The closing of this acquisition advances the long-term strategy of Fox. Beginning today, our top priority for the combined company is to continue to relentlessly serve audiences and partners, while reinforcing the openness and choice that is the essence of the Roku platform,” said Fox executive chair and CEO Lachlan Murdoch.

“Our shared entrepreneurial passion and clear conviction towards building the future together with our new Roku colleagues gives us great confidence in the opportunities ahead of us.”

Wood added: “We started Roku more than two decades ago to give people a better way to watch TV, and that mission doesn’t change today. What does change is our reach and resources. Fox has a deep respect for Roku’s culture and wholly shares our commitment to staying open to every content partner. Our teams will keep building and innovating as they always have, now with the support and capabilities of Fox behind us. I’m proud of what Roku’s employees have built, and I’m excited about what comes next.”