CRTC rules price of sale at C$1.4 billion
After three days of uncertainty, Canuck broadcaster CTVglobemedia announced Monday night that it will accept the decision by Canada’s broadcast regulator last Friday to allow it to take over rival broadcaster Chum, agreeing to sell off Chum’s five City-tv stations to Rogers Broadcasting for $352 million as a condition of the deal.
The Canadian Radio-Television and Telecommunications Commission (CRTC) had ruled that CTVglobemedia could acquire Chum for C$1.4 billion ($1.3 billion) but that CTVglobemedia would have to sell off Chum’s five City-tv stations, considered to be the main reason CTVglobemedia wanted to acquire Chum in the first place.
CTVglobemedia CEO Ivan Fecan announced Monday that his company will buy Chum even if it can’t have the City-tv channels.
“We are embracing this decision,” said Fecan. “The people of CHUM Limited have been in limbo for almost a year and it is in everyone’s best interest to move forward and build a stronger company from the combination of CTV and CHUM.
CTVglobemedia will keep the A-Channels, which had been set to be acquired by Rogers Media, per an earlier deal. But the deal to sell the seven A-Channels to Rogers was predicated on the notion that the CRTC would not enforce any significant conditions on the deal for CTVglobemedia to acquire Chum. The Rogers deal fell apart Friday when the CRTC ruled that CTVglobemedia would have to sell the City-tv stations.
CTVglobemedia also announced that the previously announced sale of CHUM’s interest in specialty stations MusiquePlus and MusiMax to Astral Media will also go forward.
CTVglobemedia will retain all other CHUM assets with the possible exceptions of specialty channel Canadian Learning Television and CBC affiliate CKX-TV. CTVglobemedia said it will announce its intentions for these stations in the next few days.
Deal to sell the five City-tv stations to Rogers is subject to CRTC and Competition Bureau approval. That deal replaces a previously announced agreement in which CTVglobemedia had agreed to sell the A-Channel stations and certain specialty channels to Rogers Media. Rogers is one of Canada’s leading cable operators.
The five City-tv stations are in Toronto, Vancouver, Winnipeg, Edmonton and Calgary.
“The acquisition of the Citytv stations will significantly expand our television operations and solidify our position as an important participant in the Canadian television industry,” said Rael Merson, president of Rogers Broadcasting. “It gives Rogers an instant and significant television presence in the largest markets in the country.”
Pact essentially gives Rogers the third private broadcast network in Canada after CTV and CanWest.
“Rogers came in with a very strong offer on a pre-emptive basis, which will see the City-tv stations in a fine home in a timely manner,” said Fecan. “This outcome is good for both the businesses and the stations’ employees. We know Rogers to be skilled operators of television assets and believe they will be good stewards of these important urban brands.”