Fox to acquire streaming provider Roku for $22 billion

Valuation and financing of the deal

Upon completion of the transaction, existing Fox shareholders are expected to hold approximately 73 percent of the merged company and Roku shareholders approximately 27 percent, as stated in the announcement. Management expects the pro forma net leverage ratio at closing to be approximately 2.8 times EBITDA, with expected run-rate cost synergies of approximately $400 million annually already factored in at 50 percent. To secure the cash tranche, Fox has obtained a firmly committed bridge financing of $12.0 billion from Morgan Stanley Senior Funding.

Anthony Wood retains his position as CEO and joins the Fox board of directors. In the announcement, Wood stated: "Die Kombination mit FOX ist eine außergewöhnliche Gelegenheit, unsere Vision zu beschleunigen, schneller zu skalieren und aggressiver für Zuschauer, Partner und Werbetreibende zu innovieren." Lachlan Murdoch described the deal as "definierender Moment für FOX und eine natürliche Erweiterung der bewussten und fokussierten Strategie, die wir seit fast einem Jahrzehnt verfolgen."

Market reactions

The news produced a mixed picture in the markets: As early as last Friday, the Roku stock on NASDAQ recorded a sharp price jump of over 20 percent and closed trading at $143.66 after Bloomberg reported on concrete takeover talks. On Monday, however, the stock temporarily fell by 1.13 percent to $142.04. Fox shares plunged in pre-market trading by as much as 15.56 percent to $49.75, as market participants priced in the short-term financial burden and integration risks of the capital-intensive streaming business. Reuters reported on Friday that Roku had been reviewing its strategic options in light of interest from companies seeking access to its vast streaming audience and advertising platform.

Strategically, the merger bundles Roku's platform business with Fox's live sports and news offerings. In the first quarter of the current year, Roku generated total revenue of $1.2 billion, an increase of 22 percent year over year. This growth was driven primarily by the platform segment, which bundles advertising revenue and subscriptions and grew by 28 percent to $1.1 billion. Advertising is the largest revenue contributor with sales of $613 million in the first quarter of 2026. By contrast, revenue in the devices segment fell by 16 percent to $118 million, as Roku strategically prices its hardware close to cost in order to expand its user base. In addition to the classic ad-supported service "The Roku Channel," which at the end of last year accounted for three percent of total US television consumption, the company also operates the paid subscription service "Howdy," which according to industry data from Antenna already has over one million subscribers.

Significance for the German market

In Germany, Roku is known above all for its affordable streaming sticks, which the US provider has offered in this country since the end of 2021. A large proportion of Roku's products were initially not competitive. The company left the market for external streaming devices to other players such as Amazon and Google. For almost five years, no new streaming devices from the manufacturer have been brought to the German market, even though new models have been released in the USA, for example. External streaming devices are no longer mentioned on the German Roku homepage. Instead, Roku has long focused almost exclusively on the sale of smart TVs with the Roku operating system in the German market. Only recently, Roku released a new interface for Roku devices whose home screen focuses more heavily on recommendations and gives advertising an increasingly significant role.

Fox stated that Roku would continue to operate as an "offene und partnerfreundliche Plattform." Together, the two companies aim to form a "Medien- und Technologiefirma der nächsten Generation" that unites live sports, news, and streaming. Investors should closely monitor the further regulatory approval process, as delays or antitrust conditions in the area of US media concentration could affect the planned closing in 2027.