As Canwest Global Dies, Shaw Media is Born
Shaw Communications has completed its $2 billion purchase of the bankrupt Canwest Global's TV assets
TORONTO -- It's dead, the white line is drawn round Canwest Global Communications Corp. and now the question is what's next for the fallen Canadian media giant after a leaner player has received a new lease on life as Shaw Media.
"The Asper family built a broadcasting organization which served our country well," JR Shaw, executive chairman of Shaw Communications, the western Canadian cable giant, completed its $2 billion purchase of the bankrupt Canwest Global's TV assets and re-named them Shaw Media on Wednesday.
Over 30 years, the Asper family of Winnipeg built a Canadian-based broadcast empire on debt, with Canwest Global represented in Canada, Australia, New Zealand, the U.K. and Northern Ireland.
But after Canwest Global pacted with Goldman Sachs & Co. to acquire Alliance Atlantis Communications Corp. in 2007 -- which included a 50% stake in the lucrative CSI franchise -- the Canadian broadcaster started to buckle under $4 billion in debt to fuel an acquisition binge pursued in better times.
To salvage the company, the Aspers started shopping and eventually selling its international broadcast assets at mostly fire-sale prices.
But by then, the Canadian media group's debt load had ballooned, and the family-controlled empire was in deep peril.
Canwest Global late last year tipped its TV and newspaper assets into separate court-directed bankruptcy proceedings.
That's when Calgary's Shaw family, already broadcasters through their Corus Entertainment TV division, pounced on a floundering Canwest Global empire.
Shaw last February first proposed to secure a controlling stake in Canwest Global to help recapitalize the media group, but opted for an outright acquisition after it faced a knock-down legal battle with Goldman Sachs.
On Wednesday, Canwest Global issued a statement in which it confirmed that it "has ceased to carry on business" after Shaw completed its deal to acquire its TV assets.
Having earlier sold off its newspaper and digital assets, Canwest Global added that its directors and officers have resigned and a court-appointed representative will "commence bankruptcy proceedings."
For Shaw, the strategy is now to rebrand Canada's Global Television network and 19 cable channels to supply the western Canadian cable giant with content that its TV, Internet and digital phone subscribers might pay for, but which would distinguish media group and its varied content offerings from Apple TV, Google TV and other pending competitors in the Canadian market.
"This acquisition brings together outstanding content and distribution capabilities and a team of talented and experienced industry leaders," Paul Robertson, the newly installed president of Shaw Media, said Wednesday.
"Together, we will change the competitive landscape and create a new Canadian broadcasting model that delivers quality content when, where and how our customers want to receive it," he added, eyeing subscribers in the wider Shaw Communications group.
Besides impressing cable subscribers with more video content, Shaw Media is also pledged to launch new morning TV news shows in major Canadian markets, pour new money into homegrown drama production, and help drive Canada's upcoming analog-to-digital transition.
Robertson comes to Shaw Media after serving as the long-time president of the Shaw-controlled Corus Entertainment.
And Global Television will continue to play catch-up with Canada's top-rated conventional TV network, CTV, which itself is subject to a pending $3.2 billion takeover by domestic phone giant BCE Inc.
CTV, which has monster hits like CBS' Big Bang Theory and ABC's Amazing Race, is on a tear after all eight rookie series it debuted this fall received full-season orders.
These include CBS' Blue Bloods, which has secured an total average audience of 1.93 million Canadians for CTV on Fridays, and 1.9 million viewers for CBS' S#*! My Dad Says on Thursdays, and 1.84 million viewers for ABC's No Ordinary Family on Tuesdays.