Fox Corp shares drop 24.9% after announcing $22 billion Roku acquisition

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Summary · why it matters

Fox Corp stock fell 24.9% this week after the company announced it will acquire Roku in a cash-and-stock deal valued at $22 billion. The transaction, which accounts for Roku's net cash, will be funded 60% in cash through new debt and equity issuance, diluting existing shareholders. The companies aim to combine Roku's 100 million active users and advertising technology with Fox's live sports and Tubi streaming platform to boost ad revenue. Investor skepticism over the debt and dilution drove the sell-off, though some analysts see long-term potential in the merged advertising capabilities.