Canadian TV Giant Corus to Acquire Rival Shaw Media for $2.65 Billion
The deal brings together two TV giants as Canadians get set for cable unbundling to start in March.
As Canada gets set for cable unbundling to start in March, two Canadian TV giants are combining.
Toronto-based Corus Entertainment on Wednesday said it will acquire rival Shaw Media for $2.65 billion in cash and stock, pending shareholder and regulatory approval. As part of the agreement, Shaw Media will receive $1.85 billion in cash and 71 million Corus class B shares, according to Corus.
"This is a transformational acquisition that redefines Corus and Canada's media landscape," Doug Murphy, president and CEO of Corus, said in a statement. Shaw Media president Barb Williams will remain with the combined Corus-Shaw Media entity in a senior leadership role.
Corus, which owns and operates the Nelvana animation studio and cable channels including W Network and Disney Canada, will acquire Shaw Media, whose assets include TV network Global Television and such cable channels as Food Network Canada, HGTV Canada, Lifetime Canada and National Geographic Channel.
Corus is controlled by Calgary's Shaw family, who are also the majority owners of Shaw Communications, a western Canadian cable giant. Shaw in 2010 acquired the TV assets of the former CanWest Global Communications Corp. to form Shaw Media as a major Canadian broadcaster.
The merger of Corus and Shaw Media six years later aims to assure the future of both broadcast entities as they remain tied to a vertically integrated media group controlled by Shaw Communications. "This transaction represents an exciting new chapter and allows us, as a family, to participate in what we see as a very successful for Corus, one that will support a vibrant Canadian broadcast system," J.R. Shaw, executive chair of Shaw Communications and Shaw family scion, said in a statement.
Brad Shaw, CEO of Shaw Communications, added in his own statement that the transaction will provide both broadcasters with the scale required to succeed in "the new regulatory environment." That's an allusion to cable unbundling ordered to start in March by the CRTC, Canada's broadcast regulator that will now consider whether to approve the Corus-Shaw Media combination.
Corus' stable of cable channels with American licensee brands include ABC Spark, Cartoon Network, CMT Canada, Disney Junior and OWN: Oprah Winfrey Network. The merger with Shaw Media will entail likely job cuts as Corus said the transaction aims to generate $40 million to $50 million in annual “cost synergies” within two years.
The merger also followed Doug Murphy succeeding a retiring John Cassaday as CEO in March 2015 after Cassaday brought Univision, the Oprah Winfrey Network and the ABC Spark cable channels to Canada.