On March 4th, BCE Inc. (Bell) received Competition Bureau clearance for a revised transaction proposal that would join Astral Media with Bell Media. The transaction also required approval by the CRTC.
Bell said that the Competition Bureau’s announcement was the result of an agreement under which Bell would sell a number of Astral TV services. Bell Media would retain 8 Astral TV services: the French-language SuperEcran, CinePop, Canal Vie, Canal D, VRAK TV, and Z Tele, and English-language services The Movie Network, which included HBO Canada, and TMN Encore.
“This positive news from the Competition Bureau is a major step forward in uniting Astral and Bell Media and delivering on our promise to grow investment and competition in Canadian broadcasting,” said George Cope, President and CEO of BCE Inc. and Bell Canada. “This decision preserves the tremendous value the transaction represents to consumers, the Canadian media community, and Astral and Bell shareholders.”
On the same day, March 4th, Corus Entertainment Inc. announced that it had entered into a number of agreements with Bell and separately with Shaw Media, and subject to CRTC approval (see below), which would “…extend Corus’ portfolio of radio assets into Ottawa, consolidate Corus’ ownership of ABC Spark and Teletoon, and enable Corus to become a significant media contributor in the Quebec and the French-language specialty television market”.
Corus said it had reached an agreement with Bell to acquire the 50% remaining ownership interest in Teletoon and two Ottawa-based radio stations, CKQB-FM (The Bear 106.9) and CJOT-FM (boom 99.7), that Bell would acquire as part of the acquisition of Astral Media Inc (for which a new proposal was awaiting the approval of the CRTC, the original having been denied) . With these acquisitions, Teletoon, Teletoon (French), Teletoon Retro, Teletoon Retro (French), Cartoon Network (Canada) and radio stations, CKQB-FM and CJOT-FM, would be wholly owned by Corus. In addition, Corus had reached an agreement with Bell and Shaw Media to acquire each of their respective 50% interests in the French-language specialty channels Historia and Series+. Certain transactions were subject to approval by the Canadian Radio-television and Telecommunications Commission (CRTC).
In a separate transaction, Corus announced that it had entered into an agreement with Shaw Media that would result in Corus acquiring the remaining 49% interest in the successful specialty television service ABC Spark from Shaw Media. As part of the agreement, Corus would sell its 20% interest in Food Network Canada to Shaw Media.
On March 6th, the CRTC announced that on May 6th the Commission would hold a hearing to consider renewed applications by Astral Media and Bell Media for authority to change the effective control of Astral’s broadcasting undertakings to BCE Inc.
Subject to Commission approval, the closing of the proposed transaction would be preceded by multi-step corporate reorganizations within both BCE and Astral for tax planning purposes and to facilitate the closing and the divestiture of certain assets.
To that end, the Commission would also hear applications by Astral on behalf of BCE to effect a multi-step corporate reorganization involving the transfer of assets of certain broadcasting undertakings to new entities to be established and controlled by BCE.
Finally, the Commission would hear an application by Astral to effect a corporate reorganization within Astral involving the transfer of the assets of certain of its broadcasting undertakings to new entities to be established and controlled by Astral.
As part of its application, Astral submitted that in order to ensure compliance with the Commission’s policies and address any concerns regarding market concentration, BCE would divest itself of 11 television undertakings: six in the French-language (Teletoon Retro, Disney Junior, MusiquePlus, MusiMax, Historia and Series+), four in the English-language (Teletoon Retro, Cartoon Network, Disney XD and Family Channel, including the related Disney Junior multiplex), and one in both languages (Teletoon).
On May 6th the CRTC began what would be a week-long hearing of BCE’s revised application to acquire Astral. There having been no decision announced by June 1st, it was announced that by mutual agreement the term for the deal to be closed had been extended to July 31st.
On May 16th, the Jim Pattison Broadcast Group announced that it had committed to the acquisition of broadcast properties, two from Bell Media and one from Astral subject to CRTC approval.
They had made a deal with Bell Media to acquire Kool FM 101.5, CKCE-FM Calgary and FAB 94.3 ,CHIQ-FM Winnipeg and with Astral to acquire QX 104, CFQX-FM Winnipeg/Selkirk.
At the time, the CRTC’s decision was awaited regarding the BCE application to acquire Astral, and it was anticipated that, if approved, BCE would be required to divest itself of several properties, including these three stations.
On June 27, 2013, the CRTC approved the application by Astral Media Inc. to sell its pay and specialty television channels, conventional television stations and radio stations to BCE Inc, subject to certain conditions. It also approved the applications by Astral on behalf of BCE for multi-step reorganizations to give effect to the main application if approved.
It was a condition of the approval that BCE must divest itself of ownership of several television and radio programming undertakings. Pending eventual sale,
the Commission directed BCE Inc. to transfer the interim management and control of those entities to a trustee pursuant to the terms of the voting trust agreement addressed in a letter of approval issued 27 June 2013, by no later than 29 July 2013.
The programming undertakings required to be sold were CHHR-FM Vancouver, CKZZ-FM Vancouver, CISL Vancouver, CFQX-FM Selkirk, CHBM-FM Toronto, CKQB-FM Ottawa-Gatineau and CJOT-FM Ottawa-Gatineau, CKCE-FM Calgary, CHIQ-FM Winnipeg and CFXJ-FM Toronto.
The specialty services required to be sold were:
French-language television
Disney Junior
Historia
MusiquePlus
MusiMax
Series+
Teletoon/Teletoon
Teletoon Retro
English-language television
Cartoon Network
Disney XD
Teletoon/Teletoon
Teletoon Retro
The Family Channel
A further condition of the approval being granted was that BCE would be obliged to keep the current 30 CTV network television stations in operation until at least 2017.
On August 26th 2013, Bell Media and Newcap Inc announced that they had entered into an agreement whereby Newcap would acquire from Bell Media Inc. the licences of five radio stations of which BCE had been required to divest itself as part of the CRTC approval for BCE to acquire Astral.
The stations involved were CHBM-FM (Boom 97.3) and CFXJ-FM (93.5 Flow) in Toronto, Ontario and CKZZ-FM (Virgin Radio 95.3), CHHR-FM (Shore 104.3 FM), and CISL-AM (AM 650) in Vancouver, British Columbia. The transaction was subject to approval from the CRTC and the Competition Bureau
On August 28th the CRTC announced that it would hold a hearing on November 5th 2013, at which the applications that Corus had announced on March 4th, to acquire various properties from Shaw Media and Bell Media, would be heard.