OTTAWA – Bell’s proposed takeover of Astral Media will undergo regulatory scrutiny at a hearing set for September 10 at the Palais de congrès de Montréal in Montreal, the CRTC announced Tuesday.
The $3.38 billion deal, announced in March, would see Bell acquire all of the issued and outstanding shares of Montreal-based Astral in addition to its specialty and pay television channels, radio stations, digital media properties and out-of-home advertising platforms. That would mean that Bell, already the country’s largest telecommunications company, would add 22 specialty television channels (13 of which are French-language) and 84 commercial radio stations, including 29 in Quebec.
As part of the deal, Bell has committed to selling off ten radio stations, (nine FM and one AM), in the Toronto, Vancouver, Calgary, Ottawa-Gatineau and Winnipeg markets, plus has asked to convert CKGM Montréal (TSN Radio 990) into a French-language radio service (to be known as RDS Radio 990) in order to comply with the CRTC’s common ownership policy which limits the ownership of multiple radio stations in a single market.
In addition, Bell proposed a tangible benefits package valued at $200 million which would include:
– $96 million for the development and production of additional Canadian programming of national interest and other on-screen initiatives in both official languages (with the majority of funds committed to French-language initiatives);
– $61 million in radio benefits to be allocated as prescribed by the CRTC and to help support, promote and develop Canadian musical talent, and assist community radio and other initiatives;
– $40 million to support Canadian programming by making it more widely available in Canada's North through the extension of next-generation broadband wireline and wireless service to all communities served by Bell subsidiary Northwestel in the Yukon, the Northwest Territories, Nunavut and Northern British Columbia; and
– $3.5 million in media support for Bell Let's Talk Day, the company’s annual multi-platform media initiative conducted across the country that raises both money and awareness to help combat mental health issues.
Under the Commission’s tangible benefits policy, applicants are required to propose tangible benefits amounting to at least 10% of the value of the transaction for all conventional and specialty television assets and 6% of the value of the transaction for all radio assets. According to Bell's application, its $139.3 million television tangible benefits will be spent over a period of ten years, and the $60.8 million in proposed radio benefits would be spent over seven years.
"Bell's commitment to provide $200 million in additional funding for Canadian broadcasting initiatives builds on the outstanding contributions Astral has made to the industry, especially in the French-language market," said Bell president and CEO George Cope, in a press release. "By increasing funds available for Canadian programming and talent, and ensuring those in the North can access programming on the broadband screens of their choice, Canadians in all parts of the country will gain from this initiative."
Bell’s application also includes plans for multi-step corporate reorganizations within both companies that would include the transfer of the assets of various radio stations and specialty services.
Comments and interventions are due by August 9. While the deal has already received approval by Astral’s shareholders and the Quebec Superior Court, Bell will be on the hook for a $150-million break fee to Astral in the event that the CRTC does not approve the transaction.
– Lesley Hunter
