Deal overview
Fox Corp. has agreed to acquire Roku Inc. in a cash-and-stock transaction that values Roku at approximately $22 billion in enterprise value. Under the terms of the agreement, Fox will pay $160.00 per share for Roku, composed of $96.00 in cash plus 0.9693 shares of Fox Class A common stock for each share of Roku. The price represents a notable premium for Roku shareholders, whose company had been undergoing a strategic review.
Scale and strategic fit
Company executives framed the transaction as a merger of a leading live-television content owner and the dominant gatekeeper on American connected TV. The combined business will pair Fox’s premium live sports and news programming with Roku’s platform, which reaches more than 100 million global households. Together, the companies expect the merged entity to become the third-largest U.S. television player by share of total viewing time.
Fox’s approach to content has been focused on appointment viewing after the 2019 sale of its entertainment assets to another studio. The company concentrated on NFL, Major League Baseball and Fox News, a strategy that shielded it from much of the cord-cutting trend but left Fox strongly tied to traditional cable and broadcast bundles. Executives say the Roku acquisition accelerates Fox’s pivot toward digital growth by giving it direct control over Roku’s home screen access in more than half of broadband households in the United States.
Streaming and ad-supported services
The transaction also brings together two free, ad-supported streaming television services: Fox’s Tubi and The Roku Channel. Fox and Roku described this as a consolidation of complementary distribution and advertising capabilities, with the potential to scale ad-supported reach and monetization across the combined user base.
Leadership comments
"This is a defining moment for FOX," said Lachlan K. Murdoch, Executive Chair and Chief Executive Officer of Fox. He added that the deal pairs "the most valuable live content portfolio in video consumption with the preeminent streaming platform through which America watches it."
Anthony Wood, the founder and CEO of Roku, who built the company from streaming-stick hardware into an advertising and software platform, will join Fox’s board of directors and will maintain an ongoing role within the combined company. "The combination with FOX is an extraordinary opportunity to accelerate our vision, scale faster and innovate more aggressively," Mr. Wood said.
Financing and projected leverage
To fund the cash portion of the deal, Fox has secured $12.0 billion in fully committed bridge financing from Morgan Stanley Senior Funding, Inc., and will also use available cash on hand. Fox disclosed that at closing its pro forma net leverage will be approximately 2.8 times core earnings, a calculation that includes half of the projected $400 million in run-rate cost synergies.
Fox said it intends for its shareholder capital return program - including dividends and stock buybacks - to continue uninterrupted, and it expects to maintain its current investment-grade credit rating.
Ownership split and approvals
Once the transaction is complete, existing Fox shareholders are expected to own roughly 73% of the combined company, with Roku shareholders holding about 27%. The boards of both companies have unanimously approved the merger. Because Anthony Wood and his associated trusts hold a majority of Roku’s voting power, Roku shareholder approval is effectively locked up through a support agreement.
Regulatory considerations and platform commitments
The deal is likely to draw regulatory scrutiny in Washington, where authorities have closely examined vertical integrations in media and technology. Fox and Roku have explicitly committed to operate Roku as an "open, partner-friendly platform," addressing anticipated concerns from independent streaming apps that rely on Roku for distribution, including services such as Netflix, Disney+ and Warner Bros. Discovery’s Max.
Timing and market reaction
The companies expect the transaction to close in the first half of 2027, subject to regulatory clearances and Fox shareholder approval. Following the announcement, shares of Fox declined 15%.
Editors note: The summary above reflects terms and statements provided by the companies and is based on the information they released regarding the transaction terms, financing, governance, and expected timeline.