CALGARY – The rumour mill had been spinning wildly over the past couple of days in Hamilton about the impending sale of Mountain Cablevision, but the buyer, announced this morning to be Shaw Communications, is a bit of a surprise.
Based in Hamilton, Ontario Mountain has approximately 41,000 cable customers and has been very successful adding services, too, with 28,000 Internet subscribers and 27,000 telephone customers.
The purchase price was not announced, but a cable company in the lucrative southern Ontario market with this many revenue generating units, expect the price to be north of about $300 million, sources have told Cartt.ca (We previously ran an incorrect, lower figure in an earlier story. We regret the error.).
"The Boris family, who owns Mountain Cablevision, has built a tremendous franchise over the last 50 years. Mountain Cablevision’s industry leading penetration rates are proof that their products and services are of superior quality and are delivered with a strong focus on customer service," said Jim Shaw, CEO and vice-chair of Shaw Communications,” in a statement.
The purchase is an odd one to figure though. Most cable consolidation happens where the buyer can integrate or interconnect the purchase into surrounding systems. That is why most figured Mountain would be sold to Cogeco, which owns the vast majority of the rest of Hamilton (Source Cable also has about 18,000 subs in the city) or EastLink, which owns a Southwestern Ontario system nearby Mountain’s footprint, which extends into Haldimand County.
Shaw’s closest system, however, is in Sault Ste. Marie, about 800 kms away.
"We believe the operating philosophies of Mountain Cablevision are similar to our own. There have been substantial investments made in the system over the years and their relationships with their customers are impressive," said Peter Bissonnette, president of Shaw.
"We are very pleased about merging with Shaw", added Owen Boris, the principal owner and founder of Mountain Cablevision, in the release. "Shaw has a reputation throughout Canada for providing exceptional products and services to their customers and treating their employees with great care and respect. These attributes were very important to our Family in considering the sale of the system to Shaw," said Boris.
"Mountain Cablevision represents one of the last remaining independent cable companies in Canada and the acquisition provides us with an opportunity to grow our business. We are delighted that we were able to successfully enter into a purchase agreement with the Boris Family through a very competitive sales process and we look forward to welcoming Mountain Cablevision’s employees to the Shaw team," added Shaw.
"We are proud of the successful communications company that we have built in Hamilton and surrounding area and there isn’t any doubt in my mind that we have chosen the right company to acquire Mountain and to continue our tradition of service through commitment to our employees and loyal customers", added Boris, an early Canadian cable pioneer who founded Mountain in July of 1959.
"These are exciting times in the broadcasting and communications arena and our philosophy at Shaw will guarantee Mountain’s customers the same excellence they have come to expect over the last 50 years."
The purchase is subject to CRTC and Toronto Stock Exchange approvals. Payment "will consist of cash and may also include the issuance of Class B Non-Voting Participating Shares of Shaw and further details regarding the transaction will be provided following receipt of the necessary approvals," reads the release.
www.shaw.ca
www.mountaincable.net
