Fox Corp (FOXA.O) is buying Roku (ROKU.O) in a cash-and-stock deal valued at about $22 billion in a bet that pairing its sports and news programming with a top TV streaming platform will strengthen its position as audiences shift online.
The deal, announced on Monday, gives the cable TV-reliant Fox direct access to Roku's large installed base of more than 100 million streaming households, helping it better sell targeted ads and reduce reliance on traditional distribution.
Fox will acquire Roku for $160 per share, representing a premium of 11.4% to Roku's last close.
Shares of Fox were down 8% in premarket trade, while Roku's shares were halted.
Roku is one of the first companies to bring streaming platforms like Netflix and YouTube to television through connected devices and smart TVs.
Its business is largely driven by advertising and subscription revenue from streaming apps on its platform. Advertising is the largest component, with revenue of $613 million in the first quarter, up 27% year-on-year.
Fox already operates Tubi, while Roku runs The Roku Channel, and a combination of the two platforms could create a clear leader in streaming, with a meaningful share of total TV viewing, JP Morgan analysts said on Sunday.
The combined company will become the third-largest player in U.S. television by share of viewing, the companies said.
The deal is expected to close in the first half of calendar year 2027.
Upon closing, existing Fox shareholders are expected to own about 73% of the combined company and Roku shareholders about 27%.
