Shaw to acquire 100% of Canwest TV
The mediaco announced this morning that it has entered into agreements to acquire all of Canwest's television business in a move that ends its dispute with Goldman Sachs.
The media landscape in Canada shifted significantly this morning, as Calgary-based Shaw Communications announced a new deal with Canwest that will see it gain full control over the company’s conventional and speciality television business.
Worth approximately $2 billion, the deal effectively ends the company’s dispute with Goldman Sachs, which had asked the Ontario Court of Appeal to block Shaw’s previous bid for the company. That agreement would have seen Shaw gain control of 20% of Canwest’s equity and 80% of its voting stock. Under the terms of the new deal – which still must pass muster with Canwest’s creditors, the courts and the CRTC – Shaw will acquire Goldman Sachs’s stake in the company for $700 million.
‘This agreement is really significant and it’s good news because it brings much-needed stability to the business,’ John Douglas, senior VP, public affairs, Canwest, tells MiC. ‘It means that there is a clear finish line in front – we have overcome a significant hurdle for emerging from creditor protection, and it also of course means we’ll have a well-capitalized, financially strong company behind us. For advertisers, this really means that we will be able to continue to deliver as we always have, and the company will be stronger and better positioned in the marketplace and better able to meet their needs.’
Outstanding claims against the company still need to be resolved, which is expected ‘very soon,’ Douglas says, and a date by which creditors will vote on the deal will be announced in coming weeks. Work on Shaw’s proposal to the CRTC for the acquisition is taking place today, he adds.
Canwest filed for creditor protection for its television division in October 2009. Shaw made its first offer for the company in February, but the deal hit a roadblock when Goldman Sachs appealed to the Ontario court to block the decision. The companies have been negotiating the deal in court since.
In a separate deal, Torstar Corp. on Friday said it has made an offer on Canwest’s newspapers and digital businesses, joined by Fairfax Financial Holdings.