Fox Corporation and Roku reached a definitive agreement for Fox to acquire Roku in a cash-and-stock transaction valuing the streaming platform at about $22 billion in enterprise value.
Roku shareholders would receive $160 per share, made up of $96 in cash and 0.9693 Fox Class A shares.
After the transaction, existing Fox shareholders are expected to own about 73% of the combined company. Roku shareholders are expected to own about 27%.
Fox has spent years avoiding the most expensive version of the subscription-streaming fight. Its biggest streaming move was the 2020 acquisition of Tubi, a free, ad-supported service that matched Fox’s preference for lower-cost programming, advertising revenue and live-event adjacency.
Roku changes the scale of that approach. Instead of only owning a free streaming service, Fox would own a platform that helps organize streaming behavior across more than 100 million households.
The transaction is backed by a $12.0 billion bridge financing facility from Morgan Stanley. Fox expects pro forma net leverage of about 2.8x at closing, including partial credit for expected cost savings. The companies expect about $400 million in run-rate cost synergies and say the deal should increase free cash flow per share by the second full year after closing.
Fox has to preserve Roku’s platform relationships, integrate advertising operations, find the promised savings and protect its investment-grade rating. It also has to convince investors that buying streaming infrastructure creates more value than the debt and dilution created by the deal.
The combination would also put Tubi and The Roku Channel under the same corporate roof. That creates a larger free streaming footprint at a time when consumers are managing subscription fatigue and advertisers are shifting more money into connected TV.
Fox and Roku say the combined company would become the third-largest US television player by viewing share.
In Q1 2026, Roku reported platform revenue of $1.13 billion, up 28% from a year earlier. Platform gross margin was 51.6% and streaming hours rose 8% to 38.7 billion. Roku also said it had passed 100 million streaming households worldwide.
The device business moved in the opposite direction. Roku reported first-quarter device revenue of $118 million, down 16% year over year.
The market’s first read was cautious. MarketWatch reported that Fox shares fell 16.8% and Roku shares slipped 1.9% after the announcement, as investors weighed the transaction structure and the size of the financing commitment.
The Roku acquisition puts Fox into a different contest from the one that defined the last decade of media. The first streaming war rewarded companies that could spend aggressively on content and absorb losses while chasing subscribers. Fox largely stayed out of that race after selling much of its entertainment business to Disney.
The next contest is more fragmented. It is about advertising yield, user data, bundling, search, free channels, subscription reselling and the interface consumers use before choosing what to watch. Roku gives Fox a shortcut into that contest but it also raises the price of failure.
The transaction has been unanimously approved by both boards and still needs shareholder approval, regulatory clearances and other closing conditions. Roku founder and CEO Anthony Wood is expected to join Fox’s board after closing. Wood and related entities holding at least a majority of Roku’s voting power have agreed to support the deal.
The expected closing window is in H1 2027.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
