Fox Corp. has entered into an agreement to purchase streaming giant Roku. The deal, valued at around $22 billion, includes debt and involves a mix of cash and stock. This acquisition will grant Fox access to over 100 million global households and the Roku channel, along with its first-party data.
Fox, known for its expansive sports, news, and entertainment network, also owns Tubi, which it acquired in 2020. Roku, founded by Anthony Wood, was initially a part of Netflix’s early ventures when the company was transitioning from DVD rentals to streaming. Roku launched its first set-top box in 2008 after being spun off from Netflix. Wood, who remains the chairman and CEO of Roku, stated that his inspiration to develop the technology stemmed from his wish to record and view his favorite show, “Star Trek.”
According to the announcement, Roku will continue to operate as an open, partner-friendly platform. The merger is set to position the combined entity as the third-largest network in U.S. television based on viewership. Fox Corp. CEO Lachlan Murdoch highlighted that merging the companies would combine Fox’s live news and sports with Roku’s vast streaming audience, expanding Fox’s reach in advertising and streaming subscriptions.
In prepared statements, Wood noted that the merger with Fox presents an exceptional chance to advance their vision, increase scale rapidly, and drive innovation for viewers, partners, and advertisers. Following completion, Wood will continue his role and join Fox’s board of directors.
Fox will offer $96 in cash alongside 0.9693 shares of its Class A common stock for each Roku Class A and Class B share. The total comes to $160 per Roku share. After the transaction closes, existing Fox shareholders will own approximately 73% of the new entity, while Roku shareholders will hold about 27%.
The deal, set to close in the first half of next year, requires approvals from both companies’ shareholders and regulators. Ahead of the market open, Fox’s shares dipped slightly, while Roku’s saw a modest increase.