MultiChoice and the SABC are heading to the Constitutional Court in an attempt to block the multimillion-rand deal between the two broadcasters from going public. According to a report by BusinessDay, the five year agreement saw MultiChoice pay the SABC more than R500 million in exchange for extensive rights to its archived content.
The applicants – the SOS Coalition and Caxton and CTP Publishers and Printers – have applied to the court to determine whether the Competition Commission was entitled to investigate the deal and to determine whether the deal was a notifiable merger in terms of the Competition Act.
If the court rules in favour of the applicants, not only will the Competition Commission investigate the deal, but the public will also be given an opportunity to scrutinise the value of the material the public broadcaster traded with MultiChoice, reports BusinessDay.
MultiChoice has come under fire over the past month regarding the value of its broadcasting deals, with a number of emails from the Gupta leaks showing that the channel had entered into several multi-million rand deals with the family’s subsidiaries.
This includes a signed amendment to an agreement which saw MultiChoice pay R50 million per year for ANN7 – up from the previous R20 million per year.
On Sunday, MultiChoice confirmed that it plans to drop the Gupta-backed news channel ANN7 from DStv when its contract expires in June 2018.