The communications regulator has expressed “concern” that the listing of MultiChoice Group went ahead on Wednesday “even though there is a complaint before its complaints and compliance committee”.
MultiChoice Group made its market debut in Johannesburg on Wednesday morning as a JSE Top40 company with a market capitalisation of about R44-billion shortly after 9am.
Ahead of its unbundling from parent Naspers and separate listing on the JSE, the bear case for MultiChoice is fairly well understood by the market. The reality, as always, is a lot more nuanced.
MultiChoice will carry losses incurred by Showmax in the “medium term”, but the goal is eventually for the streaming television service to turn a profit once broadband infrastructure in South Africa and the rest of the continent has been built out further to support it.
Streaming services pose a significant threat to MultiChoice’s future growth potential, but they are by no means the only risks exercising the minds of the pay-television operator’s management team.