Shaw Communications Picks Up 3 Canwest Stations For A Dollar Each

Talk about a good deal, Shaw Communications bought three television stations from CTV for a dollar each in April 2009. The move is not favored by all.
The deal added two A Channel stations, in Wingham and Windsor, Ont., and a privately owned CBC affiliate, CKX in Brandon, Man. to Shaw’s roster.

That news isn’t setting well with some.

Canadian Press reports that Duncan Stewart, director of research and analysis at DSam Consulting in Toronto is one such critic.

“I don’t believe the primary motivation … is that (chief executive Jim Shaw) really wants to run these three TV stations,” Stewart said

“I think he is doing this to embarrass the broadcasters, weaken their argument and put pressure on the CRTC and politicians.”

The move for Shaw to take on the three struggling stations is a bold one and politically based. The CRTC is caught in the middle of the big networks and the cable companies.

Ivan Fecan, president of CTVglobal wants the government to get back to regulating cable rates. The dispute between the CRTC and CTV got heated when Fecan said that it was willing to sell its three struggling stations for a buck each.

Shaw Communications fired back at Fecan with a full-page advertisement in the Globe and Mail taking CTV up on the $1 offer.

Canadian Press reports:

“We believe television has a bright future,” said Canada’s second-largest cable TV operator, which spun off its former radio and TV assets into a separate company, Corus Entertainment, (TSX:CJR.B) several years ago.

“These broadcasters are threatening to cut local newscasts, cut jobs and close television stations,” Shaw wrote in the letter.

“They are holding you hostage demanding a tax on subscribers as a ransom.”

CTV also ran a half-page ad thanking Shaw for making purchases.

The papers aren’t signed on the deal yet says Canwest spokesman John Douglas.

‘We have not heard from them,” said Canwest spokesman John Douglas.

‘It’s interesting that we’ve had a public process to sell our stations – Shaw expressed no interest. But if now they’re prepared to do that, we look forward to receiving an offer from them.”

Shaw couldn’t be reached after the deal was done according to the Globe and Mail. He’s said to have offered to buy up any other stations at the same price that Canwest needs to unload.

“Good for them,” Mr. Fecan said of Shaw. “I’m sure they will live up to the existing conditions of licence placed on these stations, which is wonderful news for the employees and for the people of Windsor, Wingham and Brandon,” Mr. Fecan said.

Station manager Don Mumford from Windsor was caught by surprise with the deal according to 2Canada.

“I’ve seen the various reports in the media as well. I’ve had some conversations with CTV, and — at this point in time — we’re just trying to confirm the seriousness of Shaw’s offer,” Mumford said. “I’m not quite sure where the report from Shaw originated.”

“I’m really not going to be saying anything. I know nothing on this,” he said. “This is beyond my scope, at this point.”

Shaw Communications is based out of Calgary. The company provides transmission of more than 200 television channels.

This month Shaw Communications posted $128 million in profit on continuing operations, including internet provider and digital phone services.


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