NEW YORK -- Fox Corp. has reached an agreement to acquire streaming innovator Roku in a cash-and-stock transaction valued at roughly $22 billion, including debt.

Roku will keep operating as an open platform friendly to partners, according to the companies announcement on Monday, and no immediate shifts appear likely for customers. Fox and Roku stated that the merged entity will rank as the third-largest player in U.S. television by viewing share.

Media reports emerged on Friday indicating Roku was exploring strategic options such as a potential sale. Speculation grew about possible acquirers, with names like Netflix, Amazon, Comcast and Disney circulating as candidates.

The transaction provides Fox entry to over 100 million households worldwide, plus the Roku channel and its proprietary data. Fox manages extensive sports, news and entertainment operations along with Tubi, purchased in 2020.

Roku founder Anthony Wood initially collaborated with Netflix in the early 2000s during the companys transition from DVD rentals to streaming services.

Roku was later separated from Netflix, and the firm launched its first set-top box in 2008.

Wood, serving as Roku chairman and CEO, noted his drive stemmed from a wish to record and replay his preferred program, Star Trek.

Fox Corp. CEO Lachlan Murdoch stated in remarks that merging the operations unites Fox live news and sports offerings with a high-viewership streaming service. This also expands Fox reach into advertising and subscription streaming.

The combination with FOX presents a remarkable chance to speed up our goals, grow more rapidly and pursue bolder innovations for audiences, partners and advertisers, Wood said in prepared comments.

Wood will continue in a leadership position and will join the Fox board of directors following deal completion.

Murdoch noted on a conference call that the combined firm will stand stronger for the coming decade of video than either would separately.

We believe this represents the correct deal at the proper time and for all the appropriate reasons, he said.

Fox will offer $96 in cash plus 0.9693 shares of its Class A common stock for each Roku Class A and Class B share. The deal values each Roku share at $160.

Current Fox shareholders are projected to hold about 73 percent of the combined company, with Roku shareholders owning roughly 27 percent after closing.

The transaction is slated to finalize in the first half of next year, pending approvals from Fox and Roku shareholders as well as regulators.

Fox shares fell ahead of market open, while Roku shares edged higher.