Fox Corporation has completed its $22 billion acquisition of Roku, transforming the Murdoch family company into a major player in the video streaming business.
The deal was completed on Friday, months ahead of the companies’ original target for the first half of 2027.
The deal combines Fox’s news, sports and streaming channels with the San Jose-based streaming platform, which reaches 100 million households worldwide. The $22 billion valuation includes debt.
Founded in 2002, Roku provides Fox with a direct line to consumer households at a time when the traditional pay TV universe continues to decline as viewers shift from cable and satellite services to streaming video. Fox already owns free ad-supported streaming service Tubi, which became profitable last year.
Fox Corp. expects to see a cost reduction of about $400 million within two years of the Roku acquisition.
While Roku gave Fox the opportunity to be more aggressive in marketing its channels, Fox promised that the platform would remain open to distribution of content from competitors.
“Starting today, our top priority for the combined company is to continue to continuously serve viewers and partners while strengthening the openness and choice that are core to the Roku platform,” Fox Chief Executive Officer and Chief Executive Officer Lachlan Murdoch said in a statement. “Our shared entrepreneurial passion and clear belief in building the future together with our new Roku colleagues gives us great confidence in the opportunities ahead.”
Roku founder Anthony Wood will join Fox’s board of directors. He will also serve as co-president of Fox Digital Platforms, the newly created division that includes Roku, Tubi, direct-to-consumer streaming service Fox One, and Red Seat Ventures, which provides sales and technical support to podcasters. Paul Cheesbrough, who oversees Tubi for Fox, will become co-chairman and CEO of the division.
Under the terms of the merger agreement, Roku shareholders are entitled to receive $95.30 in cash and 0.9799 shares of Fox Class A common stock for each Roku Class A and Roku Class B share they own immediately prior to closing. As a result of the transaction, Fox shareholders own approximately 74% of Fox’s common stock and former Roku shareholders own approximately 26%.
Roku shares stopped trading on Nasdaq on Friday.