Roku Issues Supplemental Disclosures on Fox Corp Merger Following Shareholder Demand Letters

Executive Summary

On October 6, 2026, Roku, Inc. (NASDAQ: ROKU) filed a Current Report on Form 8-K under Item 8.01 (Other Events) to provide supplemental disclosures to the definitive Joint Proxy Statement/Prospectus initially mailed on September 1, 2026, in connection with its pending merger with Fox Corporation (FOX).

The disclosures were issued voluntarily to resolve potential disclosure claims after Roku received demand letters from purported stockholders alleging disclosure deficiencies, a standard occurrence ahead of shareholder votes on public company mergers.

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Key Supplemental Disclosures

1. Financial Advisor Valuation Inputs (Qatalyst Partners)

   • Standalone DCF Analysis: Clarified that the discount rate range of 12.5% to 18.0% used for Roku's unlevered free cash flows was derived via the Capital Asset Pricing Model (CAPM) and Qatalyst Partners' professional judgment. Added Roku's projected standalone cash balance as of June 30, 2026: approximately $2.43 billion.
   • Pro Forma Combined Company DCF Analysis: Clarified that the combined company discount rate range of 9.0% to 13.0% was similarly based on CAPM calculations. Added the estimated combined net debt as of June 30, 2026: negative $630 million (net cash position).
   • Selected Public Companies Analysis: Disclosed implied fully diluted enterprise values (EV) across peer comparison groups, including Alphabet ($4,432.2B), Meta ($1,495.2B), Netflix ($346.2B), Spotify ($89.3B), and AppLovin ($168.8B).

2. Transaction and Retention Bonuses

   • The filing placed clear caps on transaction bonuses: an aggregate maximum of $13,000,000, with individual caps of $2,000,000 for direct reports to the CEO and $600,000 for any other employee.
   • Confirmed that founder/CEO Anthony Wood will not receive any transaction or retention bonus.

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Strategic & Market Implications

• Deal Progress: Supplemental disclosures of this nature are customary legal mechanics designed to moot disclosure-based shareholder lawsuits or injunction attempts prior to the special shareholder vote.
• Transaction Certainty: The disclosure clears procedural hurdles and helps protect the transaction timetable with Fox Corporation without altering the underlying merger consideration or economic terms.