HAMILTON – After half a century in cable, Owen Boris decided this year, at the age of 77, it was finally time to retire.
In July of 1959, Boris launched Mountain Cable in a brand new Hamilton subdivision where aerial utilities (phone and power) weren’t allowed, meaning his system was one of the first, if not the first, to go underground.
Just prior to the launch of the cable company, Boris had been a member of the engineering team who helped create the famous, and infamous, Avro Arrow jet. When that project was killed, Boris needed something to do. He had a small TV repair business going on the side, and knew people would love to receive more channels delivered clearly from Buffalo and Toronto, without the vagaries of 1950s over-the-air technology.
Serving about 41,000 people atop the Niagara Escarpment which runs through Steel City (known here as Hamilton Mountain) and into a few rural communities, Mountain Cable has since built a very loyal customer base, with a home phone penetration level that leads North American cable companies, as far as we can tell.
The company has 28,000 Internet subscribers and 27,000 telephone customers and is 55% penetrated on the digital cable front, too. They are impressive figures and makes Mountain the dominant phone company in its regions. And for valuation purposes, it gives Mountain over 115,000 “revenue generating units” (basic cable + phone + Internet + digital cable = 4 RGUs)
But despite those successes, and having watched long-time cable colleague Ted Rogers pass away last fall – and Rogers was the guy Boris wanted to sell his company to – Owen figured now the time was right to move on.
“We decided it’s time to pass this great history on to someone with more financial muscle,” said Boris in an interview with Cartt.ca.
“I had a quiet understanding with Ted that if I ever decided to sell, he would certainly be the first to get a chance and that’s exactly what we did.”
The Boris family negotiated for months with Rogers Communications, going back to April, as Owen tried to keep his promise to Ted. But it wasn’t to be. “When it came to asking for a commitment on a price, they couldn’t give us one.”
So they then hired RBC to shop the company and took bids from Bragg Communications, Cogeco Cable and Shaw. Friday was the deadline to decide and Shaw’s offer (which is strongly rumoured to be north of $220 million, although some say more) came out on top.
Rogers “did not come up with the price we expected,” and wanted to negotiate further, added Boris.
As for Cogeco, “they were nowhere near the asking price and somewhere along the way they dropped out.
“(Cogeco CEO) Louis (Audet) was bugging me month after month and year after year, phoning me and asking to sell. I finally had to tell him to stop bugging me,” added Boris.
“Then when we got the bankers involved and he had an opportunity to bid on it, he started off with a lowball, came up a little bit and then when he saw the other guys come in a whole lot higher, all of a sudden, silence.”
Mountain employees should be pleased with the new owner of the company as Shaw has agreed to maintain employment there for at least a year – and given the fact the nearest Shaw cable system is 800 kms away, they need people on the ground in Hamilton.
“They decided they wanted to have a good base of operations in Southern Ontario,” added Boris.
We tried to ask Shaw executives about their motivations in buying Mountain and whether or not it signals the beginnings of a re-entry into cable in Southern Ontario for them or does the western-based company have something perhaps more strategic in mind, but calls and e-mails were not returned by the end of the day Thursday.
