Fox completes acquisition of Roku, trading to be halted on Nasdaq

Fox Corporation has finalized its acquisition of Roku, Inc. as announced in a statement following an SEC filing on Friday. This transaction was executed through a two-step merger, making Roku a wholly owned subsidiary of Fox, which then adopted the name Roku, LLC. Roku shareholders received 0.9799 shares of Fox Class A common stock and $95.30 in cash per share, with fractional shares not issued and cash provided for any fractional shares.

Despite Roku's stock price trading near its 52-week high of $163.57 and delivering a 53% return over the past year, the acquisition was completed at $160 per share, valuing the company at about $22 billion. Roku had been profitable in the previous year with earnings per share of $3.38, trading above its fair value before the merger.

The merger terminated Roku's credit agreement with Citibank and other lenders, settling all outstanding obligations. Equity awards for employees were adjusted, with vested stock options converted into a mix of cash and Fox equity awards, while unvested ones were converted into Fox's cash and equity awards. Unvested options were canceled, and out-of-the-money options were also canceled without consideration.

Roku entered the merger with strong financials, holding more cash than debt and maintaining liquid assets above short-term obligations, with a great financial health score of 3.22. Following the merger, Roku notified Nasdaq to halt trading of its Class A common stock prior to the market opening on Monday, requesting delisting and termination of registration with the SEC.

All Roku board members and executive officers resigned upon the effective date of the transaction. The surviving company, Roku, LLC, will be managed by officers and managers from the Fox subsidiary that merged with Roku.