Fox (FOXA.US) announces a $220 billion premium acquisition of Roku (ROKU.US) to accelerate its transformation into digital streaming media.

Fox Corporation (FOXA.US) has reached a final agreement with Roku Inc. (ROKU.US) to acquire this leading streaming platform through a combination of cash and stock. According to statements released by both parties on Monday, the deal values Roku at approximately $22 billion, with a purchase price of $160 per share, representing an 11.4% premium over Roku's closing price last Friday. The transaction is expected to be completed in the first half of 2027. After the completion of the deal, existing Fox shareholders will hold approximately 73% of the merged company, with Roku shareholders holding about 27%. To support the acquisition, Morgan Stanley has provided Fox with a commitment of $12 billion in bridge financing. Boosted by the acquisition news, Roku's stock price surged 20% after relevant reports last Friday, closing at $143.66. After the official announcement on Monday, Roku's stock continued to rise nearly 3% in pre-market trading, while Fox temporarily fell by almost 14%. Through this acquisition, Fox, which has long relied on cable TV distribution, will directly reach over 100 million streaming households on Roku. Fox is betting on integrating its sports, news, and entertainment content with this top-tier TV streaming platform to more accurately sell targeted ads and reduce dependence on traditional distribution channels. The statement indicates that the combined entity will become the third-largest market participant in terms of national TV viewership share. Roku was one of the first companies to introduce streaming apps like Netflix (NFLX.US) and YouTube to TV screens through connected devices, essentially driving the transition of regular TVs to smart TVs. In a statement in April this year, the company claimed that its streaming devices had reached "over half of US broadband households." In addition to players, Roku also sells own-brand TVs, projectors, and operates The Roku Channel streaming channel. Currently, Roku's revenue mostly comes from digital advertising sales and streaming service distribution, with a small portion from device sales. In the last fiscal year, its platform business revenue reached $4.1 billion, accounting for 87.5% of total revenue, with slight growth year-over-year. In the first quarter of this year, advertising revenue, the largest source of income, increased by 27% year-over-year, reaching $613 million. Fox previously operated the streaming platform Tubi. Analysts at JPMorgan believe that the merger of the two platforms is expected to create a significant leader in the streaming field and capture a substantial share of the overall TV viewing market. After reports last Friday revealed that Roku was exploring strategic options including a potential sale, expectations for this deal have already heated up.