Fox Corp. and streaming technology powerhouse Roku have entered a definitive agreement under which Fox will acquire Roku for $160.00 per share in a combination of cash and Fox Class A common stock, valuing Roku at approximately $22 billion in enterprise value, the companies said on Monday.

The transaction combines Fox’s sports, news, and entertainment content and the Tubi streaming service with Roku’s connected TV platform, The Roku Channel, first-party data and direct relationship with more than 100 million global streaming households, the deal partners touted.

“Together, Fox and Roku will create a scaled next-generation media and technology company positioned at the intersection of two of the most important forces reshaping video consumption: the enduring primacy of live sports and news, and the continued rise of streaming,” Fox said. “Fox and Roku are committed to continuing to operate Roku as an open, partner-friendly platform and to the continued ubiquitous distribution of Fox content.”

On a pro forma basis, the combined company will become the third-largest player in U.S. television by share of viewing, “with an attractive mix of Fox’s sports, news, and entertainment content, alongside streaming services Tubi and The Roku Channel,” the companies said. “That distribution and engagement scale spans every major viewing environment – broadcast, cable, local, and streaming – creating broad and diversified reach that benefits viewers, partners, and advertisers.”

Lachlan K. Murdoch, executive chair and CEO of Fox, said: “This is a defining moment for Fox, and a natural extension of the deliberate and focused strategy we have been executing for nearly a decade. In 2019, we reoriented the company around live news and sports. In 2020, we acquired Tubi, and under our stewardship, it has become one of the most successful businesses in streaming. Today, we take the next step: bringing together the most valuable live content portfolio in video consumption with the preeminent streaming platform through which America watches it.”

Added the CEO: “This combination will transform the scope of our company into high-growth verticals and yield a step change in our overall growth profile. And we are executing this acquisition from a position of financial strength – maintaining our investment-grade balance sheet while providing our shareholders with an uninterrupted return of capital program in the form of share buybacks and dividends. Roku pioneered streaming TV and scaled it into a leading connected TV (CTV) platform. Together, we intend to lead its next chapter.”

Anthony Wood, founder, chairman and CEO of Roku, said that his team has over the past two decades built Roku into “the leading TV streaming platform, reaching more than 100 million households globally and reshaping how people discover and enjoy entertainment.” He also called the Fox deal “an extraordinary opportunity to accelerate our vision, scale faster, and innovate more aggressively for viewers, partners, and advertisers” at “a significant premium to Roku shareholders, while also providing them with the opportunity to participate in the compelling future upside of the combined company.”

The companies highlighted several strategic benefits of the big deal. One is increased scale and reach, with the firms noting that together, they will “encompass premium live content, broad distribution, and significant audience reach across linear and streaming.”

Another benefit they pointed to is an expansion in “high-growth verticals.” Namely, the deal “positions Fox across the full video ecosystem and provides a wider entry into the high-growth segment of connected TV, particularly advertising and streaming subscriptions,” according to the deal announcement.

It also opens up routes to “a more powerful streaming platform,” bringing together Fox’s “premium content and advertising capabilities with Roku’s consumer interface, home screen, platform technology and direct viewer relationships to enhance content discovery, deepen engagement and create a more compelling streaming experience for consumers and content partners.”

Last, but not least, Fox touted the deal’s benefits to the “long-term growth profile.” It “advances Fox’s business mix toward high-growth streaming and connected TV verticals and maintains a balanced mix across advertising and distribution businesses, while strengthening the combined company’s long-term growth and financial profile,” all while maintaining Fox’s “disciplined capital allocation approach.”