Fox Corporation (FOXA) shares tumbled almost 17% after unveiling a $22 billion (£16bn) agreement to acquire streaming platform Roku↗︎, a deal that instantly sparked concerns over both the price paid and the future direction of the media giant.
The transaction values Roku at $160 per share through a mix of cash and Fox stock, with shareholders receiving $96 in cash alongside 0.9693 Fox Class A shares for each Roku share. Fox has secured a $12 billion bridge financing facility to fund the cash portion while the remainder will be settled in stock.
Fox chief executive Lachlan Murdoch described the acquisition as the next stage of a strategy that began with the company’s post-2019 focus on live news and sport, followed by the purchase of Tubi in 2020.
He argued that combining Fox’s content portfolio with Roku’s streaming platform would create one of the largest forces in US television viewing.
Roku reaches more than 100 million streaming households worldwide and operates the leading smart TV platform in the United States, where its software powers more than a quarter of connected television devices. The acquisition would also bring together Roku Channel and Tubi, creating one of the largest free ad-supported streaming offerings in the country.
Yet investors appeared unconvinced.
For years, Fox has been viewed as one of the more focused media businesses, concentrating on live sports, live news and the advertising-supported Tubi platform while avoiding the costly content spending race pursued by rivals.
Roku’s appeal has been very different in that its business model relies on acting as a neutral gateway through which streaming services including Netflix, YouTube, Amazon Prime Video and Comcast reach viewers.
That distinction quickly became the central issue for Wall Street.
Analysts questioned whether Roku can continue to be viewed as an independent platform once it sits under the ownership of a major content provider whose services compete directly with many of Roku’s existing partners.
Barclays reportedly raised the issue during the analyst call, asking how Roku’s neutrality could be maintained when owned by one of the companies distributing content through the platform.
Fox believes the combination will strengthen its position in the battle for advertising revenue as audiences continue shifting away from traditional television. Industry forecasts suggest streaming advertising expenditure will continue climbing over the coming years, creating a larger pool of revenue for scaled platforms to compete over.
The agreement still faces several hurdles before completion. Shareholder approval is required from both companies, regulators must clear the transaction and newly issued Fox shares need Nasdaq approval. The merger agreement also includes significant break fees, including reciprocal termination payments worth approximately $866 million and a potential antitrust-related fee exceeding $1.2 billion in certain circumstances.
Support for the takeover already appears substantial. Voting agreements have been secured covering roughly 55% of Roku’s voting power and around 38.7% of Fox’s Class B voting power, while Roku will also gain representation on Fox’s board once the transaction closes.
Despite Fox’s argument that the deal positions the company for the streaming era, investors delivered an immediate verdict. The stock fell to around $54.62, leaving shares down roughly 26% since the start of the year and more than 28% below their January 2026 high.
