MONTREAL – Western Intl. Communications (WIC), one of Canada’s leading broadcasters, is set to become an even more significant player on the Canuck TV scene with the announcement Friday that it has reached an agreement to buy Montreal CTV affiliate CFCF-12 from the Montreal-based Videotron Group. With the acquisition of CFCF-12, WIC will have nine stations across the country and will double its ownership stake in the national CTV network to 28%.
WIC will also increase its coverage of the English-Canadian TV market to 72%, bringing it close to rival Can-West Global, which reaches 77% of English Canada.
WIC Television is partnering with a subsidiary of the Caisse de Depot et Placement du Quebec, the Quebec government’s pension fund manager, to purchase CFCF-12, with WIC holding 70% of the equity in the investment. Under the terms of the agreement, WIC and Caisse subsidiary Capital Communications (CPDQ) will pay between C$70 million ($51 million) and C$100 million ($73 million) for the Montreal station, depending on developments in the Montreal TV market.
The WIC joint venture will only have to shell out $51 million for CFCF-12 if CanWest Global receives the greenlight from federal regulator the Canadian Radio-Television and Telecommunications Commission (CRTC) to run an English-language station in Quebec City that would beam its signal into Montreal.
If CanWest Global is allowed into the Montreal market, most analysts figure CFCF’s earnings would dip substantially. The CRTC is currently studying the CanWest Global proposal to take over Quebec City station CKMI and turn it into a CanWest Global affiliate serving most of Quebec. If the CRTC turns down CanWest Global’s project, then WIC will pay Videotron $73 million for CFCF-12.
Videotron, which has holdings in the broadcast and cable biz, purchased parent company CFCF Inc. last spring mainly to acquire the cable operator CF Cable, and promptly said it planned to sell off CFCF-12.
Lever into Hollywood
The acquisition will help WIC Television move even more aggressively into the business of acquiring national rights to Hollywood shows, said WIC Television president and CEO Jim Macdonald. With the purchase, WIC now has coverage in Canada’s six most important markets.
“Strategically, it’s a very important transaction,” said Macdonald. “The Montreal English market is the sixth-largest in the country. It will give us an additional station to amortize the cost of (Hollywood) programming. I’m very proud that ours is one of the companies making an investment in Quebec rather than pulling out of Quebec.”
The CFCF-12 deal is subject to approval by the CRTC, which will hold hearings in the coming months.