Fox Corporation announced that it has entered into a definitive agreement to acquire Roku in a transaction valued at approximately $22 billion in enterprise value, combining FOX’s portfolio of live sports, news and entertainment assets with Roku’s streaming platform and connected TV ecosystem.
Under the terms of the agreement, Roku shareholders will receive $160 per share in a combination of cash and FOX Class A common stock. FOX will pay $96 in cash and 0.9693 shares of FOX Class A common stock for each outstanding Roku share. Upon completion of the transaction, existing FOX shareholders are expected to own about 73% of the combined company, while Roku shareholders will own approximately 27%.
The acquisition brings together FOX’s content portfolio, including FOX News, FOX Sports, and Tubi, with Roku’s platform, The Roku Channel, first-party data capabilities, and relationships with more than 100 million global streaming households. The companies said the combination will create one of the largest streaming businesses in the United States and position the combined entity as the third-largest player in U.S. television by share of viewing.
FOX said the transaction expands its exposure to high-growth streaming and connected television markets while enhancing its long-term growth profile. The company expects the acquisition to become accretive to free cash flow per share by the second full year following closing and projects approximately $400 million in annual run-rate cost synergies, with additional revenue opportunities.
The companies said Roku will continue to operate as an open platform, maintaining its partner-friendly approach and supporting the broad distribution of FOX content. The combined platform is expected to span broadcast, cable, local television, and streaming, providing advertisers, partners, and consumers with expanded reach and engagement.
FOX plans to finance the cash portion of the transaction through a combination of new debt and existing cash resources. Morgan Stanley Senior Funding has provided a fully committed $12 billion bridge financing facility. FOX expects pro forma net leverage at closing to be approximately 2.8 times.
Anthony Wood, Roku’s founder, chairman, and chief executive officer, will remain involved with the combined company and join the FOX Board of Directors following the transaction’s completion.
The boards of directors of both companies unanimously approved the transaction. The deal remains subject to shareholder approvals, regulatory clearances, and customary closing conditions. The companies expect the acquisition to close during the first half of calendar year 2027.
Allen & Company served as lead financial advisor to FOX, with Morgan Stanley and Goldman Sachs also advising the company. Qatalyst Partners acted as exclusive financial advisor to Roku, while Goodwin Procter served as legal counsel to Roku.
KEY QUOTES:
“This is a defining moment for FOX, and a natural extension of the deliberate and focused strategy we have been executing for nearly a decade. In 2019, we reoriented the company around live news and sports. In 2020, we acquired Tubi and under our stewardship it has become one of the most successful businesses in streaming. Today, we take the next step: bringing together the most valuable live content portfolio in video consumption with the preeminent streaming platform through which America watches it. This combination will transform the scope of our company into high-growth verticals and yield a step change in our overall growth profile. And we are executing this acquisition from a position of financial strength, maintaining our investment grade balance sheet while providing our shareholders with an uninterrupted return of capital program in the form of share buybacks and dividends. Roku pioneered streaming TV and scaled it into a leading CTV platform. Together, we intend to lead its next chapter.”
Lachlan K. Murdoch, Executive Chair and Chief Executive Officer, Fox Corporation
“Over the past two decades, we’ve built Roku into the leading TV streaming platform, reaching more than 100 million households globally and reshaping how people discover and enjoy entertainment. I’m incredibly proud of what our team has built, and the combination with FOX is an extraordinary opportunity to accelerate our vision, scale faster and innovate more aggressively for viewers, partners and advertisers. That’s why our Board of Directors unanimously determined after concluding its strategic review process that this transaction offers a significant premium to Roku shareholders while also providing them with the opportunity to participate in the compelling future upside of the combined company. I couldn’t be more excited about what we’ll accomplish together.”
Anthony Wood, Founder, Chairman and Chief Executive Officer, Roku
