MONTREAL — Embattled Canuck TV producer Cinar Corp. announced Wednesday that it has hired investment bank Merrill Lynch & Co. as an adviser to explore its options, including the potential sale of all or part of the company.
Montreal-based Cinar, which has been at the center of a major financial scandal for several months, has been under intense pressure from several major shareholders who have been pushing the troubled company to hook up with a U.S. bank and try to make a deal to sell the company.
“Merrill Lynch & Co. will work with us and our current advisers, PricewaterhouseCoopers, to review all strategic alternatives available to the company in order to maximize future shareholder value, including any proposed business combinations, partnerships or mergers,” said Cinar CEO Barrie Usher. “We are very pleased and look forward to benefiting from Merrill Lynch’s expertise to help us resolve our present situation.”
Cinar has been in trouble since allegations were raised in the House of Commons last fall that the company had committed tax fraud by putting phony Canadian names on screenplays actually written by Americans in order to access the lucrative Canuck tax-credit system.
This spring, Cinar co-CEOs and co-founders Ronald Weinberg and Micheline Charest were forced out when auditors discovered that over $100 million had gone missing in suspicious offshore investments made without board approval.
Potential suitors rumored to be circling Cinar include cable web Nickelodeon (which has aired many Cinar series over the years), Toronto-based animation company Nelvana, rival Canadian TV producer Alliance Atlantis Communications and fast-growing media giant CanWest Global Communications, which earlier this week inked a C$3.5 billion ($2.4 billion) deal to buy many of the top newspapers in Canada from Hollinger.