MultiChoice picks up R1.3bn stake in Nigeria's BetKing
MultiChoice has acquired a 20% stake in Nigerian online sports betting company BetKing for R1.3 billion, with the potential for a further R500 million investment, as the pay-TV group expands its entertainment ecosystem.
The company revealed the details yesterday when presenting its half-year to September results, saying BetKing is a high-growth sports betting group with operations in Nigeria, Kenya and Ethiopia.
BetKing also offers agency opportunities for individuals who will come to be called Kingmakers once they sign up to deliver offline betting services to customers.
In the period under review, MultiChoice reported a 41% rise in earnings as a result of increased entertainment demand during the COVID-19 lockdown.
The group added 1.2 million 90-day active subscribers year-on-year, to close the period on 20.1 million households, exceeding the 20 million subscriber milestone for the first time.
The customer base is split between 11.4 million households (57%) in the rest of Africa and 8.7 million (43%) in South Africa.
MultiChoice says it continued its strategic focus of investing in local content and produced 1 870 additional hours, despite disruptions caused by strict early COVID-19 lockdown measures.
The company now has a local content library of close to 59 000 hours and it launched nine new channels across Sub-Saharan Africa since the start of the year and another 13 channels as part of the Ethiopian relaunch strategy.
CEO Calvo Mawela says: “Our subscriber base of more than 20 million customers provides considerable scale and a platform to continuously add more products and services. We believe that, whether organically or through third-parties, offering our customers an ecosystem of video entertainment options will be fundamental to our long-term success and to making our customers’ lives more convenient and fulfilling.”
The company says the South African operations delivered a resilient performance in a tough consumer climate, reporting subscriber growth of 7% subscribers on a 90-day active basis.
“The impact of COVID-19 and the associated lockdown saw consumers prioritise video services, but a lack of live sport and the inability of commercial subscribers to trade negatively impacted revenue generation,” it says.
Revenue for local operations declined 3% to R16.5 billion, which the company says was affected by the lower advertising and commercial subscriber revenues.
Trading profit increased 12% to R5.8 billion. “This higher profitability can be attributed to a doubling down on the group’s cost optimisation programme, the non-recurrence of three major sporting events expensed in the comparative prior period, lower operational costs in a COVID-19 environment and a temporary shift in content costs as a result of delays in sporting events.”
Additionally, MultiChoice says connected video users on the DStv and Showmax platforms continue to grow as online consumption increases in SA.
During the reporting period, Showmax launched Showmax Pro, the group’s first standalone online sports offering. Showmax Pro allows subscribers to watch their series, movies, kids and sport content across several devices, while also offering a mobile option at a lower price point.
Turning to the performance of its technology company Irdeto, MultiChoice says over the past six months, the company gained market share in providing digital security services and won 18 new customers across both traditional video entertainment and connected industries.
MultiChoice says Irdeto’s Keystone security technology is now also being used by Chinese vehicle manufacturer, Beijing Hyundai, which has already shipped 50 000 new vehicles with this technology into the market.
Irdeto also provides security services to five of the six largest global over-the-top players, and technical capability to the MultiChoice group in protecting platforms and applications for video entertainment, video games, connected transport and Internet of things connected industries.