OTTAWA – The CRTC will have the opportunity to bless the marriage of CanWest and Shaw at a hearing scheduled for September 20, 2010.
The $2 billion deal was approved by an Ontario court in June, but still requires approval by the Commission and the Competition Bureau.
The Regulator said Thursday that it will first consider an application by CanWest Global Communications for a multi-step corporate reorganization which would see its broadcasting and specialty channel assets fall under one entity.
Next up will be Shaw’s application to transfer the effective control of Canwest Global’s broadcasting entities to a wholly-owned Shaw subsidiary currently listed as a numbered company.
(Ed note: An earlier version of this story contained incomplete data about Shaw’s proposed tangible benefits package).
Shaw has proposed a tangible benefits package it values at $203 million, or just over 10% of the transaction. The figure consists of the $95 million for the fulfillment of outstanding benefits left over from the Canwest-Alliance Atlantis merger, plus $108 million in new benefits for what it described as “digital and programming initiatives”.
The new benefits include $23 million to convert CanWest’s 35 transmitters in non-mandatory markets to digital after the industry-wide transition on August 31, 2011 (although you can bet more than one group will call that bit "a cost of doing business" and not a "benefit"); $24 million in additional programming content; $18 million towards new media content, such as mobile and VOD applications, to complement domestic programming initiatives; and $43 million earmarked for new morning news shows in the markets of Toronto, Winnipeg, Regina and Saskatoon.
Shaw believes that the original transaction triggered the change in control, and that Goldman Sachs would not have been allowed to control any Canadian broadcasting assets.
In response to the CRTC’s notice, Shaw issued a statement saying that it is “excited about the opportunity to assume control of CanWest”.
"We look forward to completing what we anticipate will be the last step in finalizing CanWest’s emergence from protection under the Companies’ Creditors Arrangement Act so that we can begin the job of rebuilding CanWest," said CEO and vice-chair Jim Shaw, in the statement.
The deadline for comments and interventions is August 23, 2010.
