GATINEAU – An acquisition which would see Bell Media pay $20 million to add five conventional French television stations in Québec, Montréal, Saguenay, Sherbrooke and Trois-Rivières from Groupe V Media will be probed by the CRTC in February.
In July, Bell Media announced its intention of to purchase certain Groupe V assets, pending CRTC approval and the application was made public today, Bell is requesting the conditions of licence for the V conventional stations relating to the broadcast of local programming and local news be maintained where:
- each station shall, in each broadcast week, broadcast at least five hours of local programming, including at least two-and-a-half hours of locally reflective news; and
- the licensee shall, in each broadcast year, devote to the acquisitions of, or investment in, locally reflective news, at least 5% of their previous year’s gross revenues.
Bell also committed to:
- producing news internally;
- redesigning its news broadcasts for the Montréal and Québec City markets by devoting 90 minutes per day to local news and 30 minutes on Saturdays and Sundays;
- redesigning its news broadcasts for the Trois-Rivières, Sherbrooke and Saguenay markets by devoting 60 minutes per day to news from Monday to Friday and 30 minutes on Saturdays and Sundays; and
- investing in information platforms so that viewers can access online news content.
While the purchase price is $20 million, Bell reported the value of the transaction when it comes to tangible benefits is $25,204,508, which includes a working capital adjustment and the value of the leases that will be assumed, reads the application. The value of Groupe V’s digital (i.e. unregulated) assets Bell is also purchasing, such as its ad-supported VOD platform Noovo.ca, are not part of the announced price, nor subject to CRTC approval.
So, Bell proposed a tangible benefit package of $2,520,451 (10% of the value) and that 60% of this amount go to the Canada Media Fund and 40% to the Bell Fund. It also proposed all of these amounts be used for French-language programming initiatives.
V also has affiliate stations in Gatineau, Abitibi, Rimouski and Rivière-du-Loup which are owned by RNC Media and Tele Inter-Rives. Those are not part of the transaction and Bell’s application notes it wishes to renew those affiliation contracts when they expire in 2020.
The application also notes in its Diversity of Voices policy, the CRTC determined that a transaction giving a control of less than 35% or the viewing market would be processed without delay. Bell Media’s market share after the acquisition of V would only be 22% of the French language market, while Québecor, with the acquisition of Evasion and Zeste, has reached 37% market share in the province.
Groupe V mentioned in its application to change the corporate ownership of its discretionary French-language services ELLE Fictions and MAX, which V owner Maxime Remillard is retaining control of under MusiquePlus Inc., that the challenges faced by conventional television stations are felt more acutely by a small independent provider. The company said it lost close to $7 million in the last two broadcast years on the V stations, with increased losses expected in the current broadcast year. The only solution, said the company, is to be part of a larger group, such as Bell Media, which can spread production costs across a greater number of assets.
The application also says the transaction value is below the Competition Bureau thresholds, so its approval is not required.
As well, the application noted a service management agreement with Bell Media has been entered into regarding sales and technical assistance services for ELLE Fictions (which was formerly MusiquePlus) and MAX.
Groupe V is presently owned by Remillard’s Remstar Group Inc. (45.14 %), Fiducie Seismikmax (9.86 %), Caisse de Dépôt et de Placement du Québec (15%), Fonds de Solidarité des travailleurs du Québec (15%), and Investissement Québec (15%).
