Fox-Roku Deal Spread Widens to $2.11 as States Review Agreement
Key Facts
The spread on Fox's acquisition of Roku widened slightly to $2.11 on Wednesday, October 28, from $1.89 the previous day, according to a report published by Seeking Alpha. The report linked the move in the spread to news that a few states, including New York, were reviewing the deal, citing a report by Capitol Forum. It said the states' review had not advanced much. Seeking Alpha did not attribute the move to a confirmed cause, nor did it report a formal objection to the agreement. Roku is valued at about $22 billion in the deal on an enterprise value basis, according to Fox's announcement.
The report said the companies' offices and the attorney general's office had not announced any problems with the merger by that time. It also said a spokesperson for the New York attorney general's office declined to comment. That limits what can be inferred from the review report: it described an ongoing review but did not mention a public objection or a step that would delay the deal. The initial draft had described the move as an investigation by several states, while the report described a review by a few states. The report offered no confirmed explanation for the wider spread.
The report of a state review comes as the deal is also under review by the U.S. Justice Department. Fox and Roku disclosed to the Securities and Exchange Commission that they had received a second request for information and documents from the department on September 8, 2026. The HSR Act extends the waiting period to 30 days after the companies have substantially complied with the request, unless the department ends the period early or the parties agree to extend it. The request means the federal review had not concluded when the disclosure was filed. Regulatory approvals and other conditions remain part of the process required to complete the agreement.
Fox announced a definitive agreement to acquire Roku on June 15, valuing the company at about $22 billion on an enterprise value basis. The consideration includes cash and Fox shares, so its value is not a fixed cash amount independent of Fox's share price. Agency documents valued the implied consideration at $161.16 per share, calculated using the August 27, 2026, closing price of Fox Class A shares on Nasdaq. This implied valuation changes with Fox's share price, based on the calculation method set out in the documents. The deal spread therefore reflects a comparison between Roku's share price and the estimated value of the consideration, rather than a fixed cash offer per share.
Upon completion of the deal, Fox shareholders are expected to own about 73% of the combined company, versus about 27% for Roku shareholders. Fox says Roku's platform reaches more than 100 million streaming households worldwide. The company also estimated expected ongoing annual cost savings of about $400 million, with the potential for additional revenue. These figures frame the deal as a way for Fox to expand its presence in digital streaming and link its business with Roku's platform. They remain estimates in the company's announcement of the agreement, while completion of the merger remains conditional on the required processes and approvals.
In trading, Roku closed at $156.66 on October 27, according to EL7 data. The close followed $157.23 on October 26, $158.58 on October 23, $160.06 on October 22 and $157.78 on October 21. These prices provide context for the stock's movement in the days before the report of a wider spread. The report did not give Wednesday's share price movement or the size of its change that day. The reported effect of the news on trading is therefore limited to the spread recorded on Tuesday and Wednesday.
Roku's special shareholder meeting to consider the merger agreement was scheduled for October 14, 2026, according to agency documents. Fox expects to complete the deal in the first half of 2027, subject to the expiration or termination of the waiting period and the satisfaction of customary conditions, including approval by both companies' shareholders. Completion of the Justice Department review remains part of the regulatory process before closing. The states' review cited in the report had also not advanced much, and had not been accompanied by an announcement of a formal objection from the companies or the attorney general's office. The first half of 2027 remains the expected completion timeline set by Fox.