Key takeaways:
- Fox said it will acquire Roku for $160 per share in a cash-and-stock transaction expected to close in the first half of 2027.
- The combined company would become the third-largest U.S. television player by share of viewing, according to Fox.
- Fox shareholders are expected to own about 73% of the combined company, while Roku shareholders would own about 27%.
Fox Corp. said Monday it will acquire Roku, a deal that would combine one of the country’s biggest streaming platforms with Fox’s live television business and make the company a larger force in U.S. viewing and digital advertising.
The companies described the transaction as a cash-and-stock deal valued at $160 per Roku share. CBS News reported the deal is worth $22 billion, while NBC News reported that final terms in a filing value the transaction at $25 billion overall. Fox said the acquisition is expected to close in the first half of 2027.
If completed, the deal would make Fox the third-largest player in U.S. television by share of viewing, the company said. Roku reaches about 100 million households, according to Fox, and NBC News reported that the acquisition would add more than 100 million global streaming households to Fox’s business.
Roku, based in San Jose, California, is best known for its streaming devices, operating system and Roku Channel. Fox said Roku will continue to operate as a standalone platform. The service is also a major gateway for viewers who use Roku devices and software to access apps such as Netflix and YouTube on their televisions.
Fox’s television portfolio includes Fox News and live sports broadcasts, including NFL, MLB and FIFA World Cup events. The company already owns the ad-supported streaming platform Tubi, which it acquired in 2020. By adding Roku, Fox is seeking to expand its position in connected television advertising and targeted ads.
“Buying Roku is a continuation of Fox’s strategy to expand digital ad revenues through acquisition,” Emarketer senior analyst Ross Benes said in an email. “Through its [automatic content recognition] footprint and the popularity of its operating system, Roku is set to remain a major player in the streaming marketplace for years to come. Acquiring Roku would more than double Fox’s annual [connected TV] ad revenues.”
According to Nielsen data cited by NBC News, the Roku Channel accounts for 3% of all streaming viewership in the United States, placing it fifth behind YouTube, Netflix, Disney and Prime Video. Reuters, cited by NBC News, reported that advertising is Roku’s main revenue source, bringing in $613 million in the first quarter of this year, up 27% from a year earlier.
Fox said its shareholders are expected to own about 73% of the combined company after the deal closes, while Roku shareholders will own about 27%. NBC News reported that Fox is borrowing $12 billion to fund the transaction.
Investors reacted sharply to the announcement. Fox shares fell as much as 18% in Monday trading, NBC News reported, as some investors questioned the 11% premium Fox paid over Roku’s Friday closing share price.
The proposed takeover comes amid a broader wave of consolidation in entertainment as media companies compete for viewers shifting from traditional television to streaming. CBS News reported that the Justice Department on June 12 cleared the way for Paramount Skydance, the parent company of CBS News, to buy Warner Bros. Discovery in a $110 billion deal combining Paramount+ with HBO Max. Walt Disney Co. also announced last year that it would integrate Hulu and Disney+ into a single app, and Disney completed its takeover of Hulu in 2025.
Some experts have warned that media consolidation could reduce pay for industry workers and raise costs for consumers by leaving them with fewer choices.
“It remains to be seen how well the combination of a digitally innovating streaming company will mesh with a media conglomerate rooted in legacy assets,” Benes said. “But the strategy makes sense, and it jibes with the continual consolidation that’s occurring in streaming.”
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