Fox Corporation has agreed to acquire streaming and television company Roku in a cash-and-stock deal valued at close to $US22 billion ($31 billion AUD).
FOX will pay $160 per share, comprised of $96 in cash and 0.9693 shares of FOX Class A common stock.
The purchase will combine FOX's sports, news and entertainment content, as well as the Tubi service, with Roku's connected TV platform, The Roku Channel, and its first-party data.
Roku has a direct relationship with more than 100 million global streaming households, according to Fox Corporation.
If the deal goes ahead, the company would become the third-largest player in US television on a combined basis, by share of viewing, according to Fox.
"Together, FOX and Roku will create a scaled next-generation media and technology company positioned at the intersection of two of the most important forces reshaping video consumption: the enduring primacy of live sports and news, and the continued rise of streaming," said Fox Corporation in a statement.
"That distribution and engagement scale spans every major viewing environment — broadcast, cable, local and streaming — creating broad and diversified reach that benefits viewers, partners and advertisers."
Lachlan Murdoch, executive chair and CEO at Fox Corporation, said the acquisition marked a significant shift for the company.
"In 2020, we acquired Tubi and under our stewardship it has become one of the most successful businesses in streaming," said Murdoch.
"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."
Anthony Wood, Roku's founder, chairman and CEO, will have an ongoing role at the combined company and will join the FOX board of directors following completion of the deal.
The deal has been unanimously approved by the boards of directors of both companies and is subject to shareholder approvals from both companies and regulatory clearance in the US and other markets.
For Australian audiences, the deal could impact the future of streaming in the local market.
Roku already operates domestically as a TV streaming provider, with its televisions equipped with services including HBO Max, Apple TV, Tubi, Prime Video, 9Now and Paramount+.
In 2015, Roku partnered with Telstra to bring the platform to local consumers under the Telstra TV name, accumulating 800,000 active subscribers.
However, the contract was not renewed and Telstra pivoted to Fetch TV in 2022.
Should Fox choose to re-enter Australia through Roku as a standalone streaming platform, mirroring the model of The Roku Channel in the US, it could bring a new competitor to Foxtel, Kayo, Stan and Australia's free-to-air broadcasters.
Unlike the Telstra partnership, a Fox-backed Roku would arrive with direct access to premium sports and news assets, content that attracts premium advertising rates in the US market.
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.