CanWest closing in on CTV: Asper

Global and E! are in a 'dead heat' with the rival net, said the CanWest CEO in a year-end talk with analysts, citing gains in the Vancouver and Toronto markets. And no major problems from the writers' strike are anticipated.

CanWest Global Communications has caught up with CTV in the TV ratings chase, and has even pulled ahead in the Vancouver TV market, network executives claimed on Friday.

‘We are currently in a dead heat with our major conventional competitor in Canada with respect to audience share,’ CEO Leonard Asper told analysts during a conference call after his company unveiled the results of its fiscal 2007 year.

Kathy Dore, president of television and radio for CanWest MediaWorks, added that her network had moved past CTV in the Vancouver market in terms of local market share, and had significantly closed the gap in the Toronto market.

CanWest Global commentary accompanying the results stated that ‘an aggressive approach to improving and refreshing the prime time schedule on both Global Television and the newly launched E! channels appears to be paying off, as the new schedules on both networks have captured a larger share of audience and a larger number of the top ten programs across the country.’

The Canadian TV operations saw full-year revenues rise, though they fell during the fourth quarter – traditionally a slow period when reruns dominate. During the latest quarter, Canadian TV revenues fell 2% to $127 million, while the EBITIDA line indicated a $10.2-million loss, compared to a $22-million loss in 2006.

Dore expressed surprise that the current fall TV season has produced no breakout hits among the rookie series, though she added that Bionic Woman on E! is performing well, as are second- and third-season shows like Brothers and Sisters and NCIS.

CanWest Global recently acquired 13 cable channels from Alliance Atlantis Communications, and will shortly appear before the CRTC to secure regulatory approval for the $2.3-billion takeover. During Friday’s conference call, Asper did not directly address speculation that the CRTC may order CanWest Global to inject more equity of its own, or adjust its convoluted shareholders’ agreement with Goldman Sachs, to ensure that the mega-deal does not flout current foreign ownership restrictions over Canadian media companies.

Asper said CanWest Global has proposed an initial investment of $262.3 million for a 36% stake in a new broadcast joint venture comprising Global Television and Alliance Atlantis’ specialty channels. Goldman Sachs is to finance the rest with $480.8 million of its own money and another $765 million in bank financing and senior notes.

Should the CRTC order CanWest Global to increase its stake in the broadcast joint venture to 50% or more, that would cost the Canadian broadcaster far more of its own equity and possibly compel Goldman Sachs to walk away from the original deal.

CanWest executives also said they are well prepared to weather the US writers’ strike, as long as it does not drag on. ‘We don’t see huge implications, assuming the strike doesn’t go past December,’ Dore said.

From Playback Daily