Astral Media

Astral Media, Inc.
Public
Traded as TSX: ACM.A, ACM.B
Industry Mass media, outdoor advertising
Fate Acquired by Bell Canada
Founded August 31, 1961
Defunct July 5, 2013
Headquarters Montreal, Quebec, Canada
Key people
 Ian Greenberg
(President, CEO & co-founder)
Revenue Increase $1.02. billion (2012)[1]
$204.4 million (2012)[1]
Number of employees
 2,800+ (2010)[1]
Website astral.com

Astral Media (branded simply as Astral since 2010) was a Canadian media corporation. It was Canada's largest radio broadcaster with 84 radio stations in eight provinces, and was a major player in premium and specialty television in Canada, including The Movie Network, Super Écran, Family, Télétoon, Canal D, Canal Vie, VRAK.TV, Séries+, Ztélé and more. Astral also had numerous billboards for outdoor advertising through its Astral Out-of-Home division.

In March 2012, Astral Media announced that it had accepted a $3.38 billion bid to be acquired by Bell Canada, a merger which would give the company's Bell Media division a larger presence in the premium television and French language media sectors. However, the proposed acquisition was met with criticism from other broadcasters and television providers, who showed concerns surrounding the combined market power that Bell would have following the merger. As a result, the acquisition was blocked by the Canadian Radio-Television and Telecommunications Commission in October 2012. A revised merger, which saw the divesture of several Astral-owned television properties and radio stations to competing companies, was approved by the CRTC on June 27, 2013, and closed on June 5, 2014. The company was dissolved in July 2014 as a result of Astral's assets being officially acquired by Bell.[2]

The Astral brand survives solely through its use by the Astral Out-of-Home division. Astral Media Radio G.P. remained the licensee for most of the Astral radio stations acquired by Bell until July 2014, when it was renamed Bell Media Radio G.P.[3]

History

Astral Media Vehicle

Angreen Photo

Astral Media's roots lie with Angreen Photo, a Canadian company founded in 1961. It was created when Montreal's Greenberg brothers,[4] led by Harold Greenberg, founded it to operate the photography concession in Miracle Mart, a department store chain. Its acquisition in 1963 of Bellevue Pathe lead to rights at the Montreal Expo eventually grew into a 125-store chain, Astral Photo,[4] the remnants of which are now owned by the Black's Photography chain. The store grew quickly into motion picture processing after acquiring the Pathé-Humphries motion picture lab in 1968 and Associated Screen News Industries of Montreal in 1969.[4]

Astral Communications Limited

The Greenbergs took Astra Photo public as Astral Communications Limited on July 26, 1971.[4]

Astral, was constituted in 1973 under the name Astral Bellevue Pathé Limited. Astral eventually undertook videocassette duplication and video wholesaling. Astral also produced or executive produced over 100 feature films and television programs and television miniseries.

In 1983, the Greenbergs acquired complete control of two pay television networks, First Choice (now known as The Movie Network) and Premier Choix TVEC (now Super Écran), at which point Astral ceased to be directly involved in film and program production. The company would later expand its television operations by launching new specialty networks. Later, it also became involved with the home video market, lasting from the mid-1980s until at least 1996. In February 2000, Astral Communications changed its name to Astral Media.

In recent years, Astral had expanded into radio, beginning with the 2000 acquisition of Radiomutuel, and the 2002 purchase of most of the radio assets of Telemedia, although those companies' joint AM radio network Radiomedia was ultimately sold to Corus Entertainment for competitive reasons. Radiomutuel also owned a controlling share of outdoor advertising firm Omni Outdoor (which eventually became the fully owned Astral Out-of-Home division), as well as several French-language specialty channels such as Canal Vie, Ztélé, Séries+, VRAK.TV, and 50% stakes in MusiquePlus and MusiMax (then co-owned with CHUM Limited).

Former logo, from 2000 to 2010, using the full company name.

On February 23, 2007, Astral Media announced that it had signed a letter of intent and had entered into exclusive negotiations regarding the acquisition of "substantially all of the assets" of Standard Radio.[5] A formal agreement was later announced, with the proposed transaction being approved by the CRTC on September 28, and completed on October 29 of the same year. The transaction gave Astral Media a significant foothold in English-language radio.

In May 2010, Astral Media remodeled its image with the introduction of a new logo. The company then began trading simply as "Astral" and all references to the "Media" part were removed from the logo and airwaves. However, the company's official name remained Astral Media. Following this change, Astral relocated its headquarters to a building that was renamed after itself.

Acquisition by Bell Media

On March 16, 2012, Astral Media announced that it accepted an estimated $3.38 billion takeover bid by Bell Canada to merge with the company's Bell Media division. Astral Media shareholders approved the acquisition of all of its issued and outstanding shares by Bell Media on May 24, 2012;[6] the acquisition of Astral Media's issued and outstanding shares by Bell received approval by the Quebec Superior Court during a hearing on May 25, 2012.[7]

Opposition and rejection

The Bell/Astral merger was notably opposed by several competing media companies. Cogeco, Vidéotron, and Eastlink formed a coalition and awareness campaign known as "Say No To Bell" in August 2012 to publicize their concerns surrounding the deal. The companies believed that the merger could financially cripple smaller cable companies due to increased carriage rates, and that Bell's control of a majority of Canadian media would harm consumer choice.[8] During the CRTC's hearing, the Canadian Broadcasting Corporation also believed that Bell's plans to launch a French-language news channel (which would compete with its own Réseau de l'information) funded using its mandatory tangible benefits was "self-serving and unprecedented."[9] In September 2012, the Competition Bureau stated that it was becoming "increasingly concerned" about the implications of the merger, and warned that it could oppose the deal even if it were to be approved by the CRTC.[10]

On October 18, 2012, the CRTC announced that it had rejected BCE's proposal to acquire Astral Media. The commission cited that their combined market power could "threaten the availability of diverse programming for Canadians and endanger the ability of distribution undertakings to deliver programming at affordable rates and on reasonable terms on multiple platforms", and also stated that allowing the merger would have required the implementation of "extensive and intrusive safeguards" across the entire broadcasting industry. The CRTC also felt that Bell did not adequately demonstrate how having most of Canada's French-language media be owned by two vertically integrated companies would improve competition, and how being bigger would allow it to compete against foreign services.[11]

Second attempt

Following the rejection of the deal by the CRTC, Bell Canada CEO George A. Cope asserted that calling the merger dead was "premature", citing that the formal merger agreement between Bell and Astral did not expire until December 16, 2012, and either company could extend it to January 15, 2013. Bell attempted to ask the Cabinet to overturn the CRTC's decision, but was told that they did not have the ability to do so. Bell also reportedly considered going to the Federal Court of Appeal, or restructuring the deal to selectively sell Astral assets to competing companies. Rogers Media expressed interest in acquiring some of Astral's channels if such a sale were to occur.[12][13] On November 16, 2012, Astral confirmed that it was in talks with Bell to negotiate a new offer, which would involve the sale of the majority of its English-language television channels to third parties.[14]

On March 4, 2013, the Competition Bureau approved a new proposal by Bell to acquire Astral Media, which would involve the divestiture of certain television channels and radio stations owned by the combined company, and was subject to restrictions preventing Bell from imposing restrictive bundling requirements on any provider seeking to carry The Movie Network or Super Écran (which were among the eight channels that would be acquired by Bell through the merger).[2] The CRTC made the proposed takeover proposal public on March 6, 2013.[15] Unlike the previous deal, which would have given Bell a 42% share of the English-language television market, the new deal gave Bell a total market share of 35.7%, and increased its French-language market share to 22% (in comparison to 8% before).[16][17] On March 18, 2013, the Competition Bureau cleared a proposed deal to sell Astral's stakes in several channels to Corus Entertainment in preparation for regulatory approval.[17]

In a speech to the Academy of Canadian Cinema and Television prior to the hearings, Bell Media's president Kevin Crull detailed plans to invest in French-language productions and maintain a distinct operation in Montreal devoted to its French-language outlets. Crull also praised the role of Québecor Média (despite the company, ironically, being opposed to the merger) in using its own vertical integration strategy to help promote Francophone talent, and revealed his intention to try and emulate the "star system" Québecor had developed to help promote talent in English Canada.[18]

Hearings and approval

CRTC hearings on the new proposals began in May 2013. Asserting that it would have to sell or shut down the station without one, Bell organized a petition proposing an exception to the ownership cap (similar to one that the CRTC granted Cogeco in its purchase of Corus Québec) that would allow it to maintain ownership of CKGM, under the condition that Bell maintain the TSN Radio format on the station and provide $245,000 in funding for local amateur sports and scholarships in sports journalism over a seven-year period. Commissioner Suzanne Lamarre commented that Bell could have sold another station instead, given most of the comments on Bell's petition only supported CKGM maintaining a sports radio format, and not Bell's purchase of Astral. In response, Bell's CEO George A. Cope commented that the company did not want to sell off profitable radio stations, and Astral CEO Jacques Parisien remarked that breaking up its Montreal cluster would have an impact on their operation.[19]

Rogers called on the CRTC to require that Bell divest The Movie Network, claiming that Bell would make it harder and more expensive for competing service providers to access The Movie Network's content (especially on its own Anyplace TV and on-demand services) if Bell were to own the service. Bell disputed Rogers' claims, stating that the company already had a long-term deal with The Movie Network for access to its content, and noted that Rogers showed interest in purchasing the service if it were to be divested.[20] Bell indicated that it would not go ahead with the deal if it were forced by the CRTC to sell additional media outlets.[21] Rogers also showed interest in making a "reasonable offer" to purchase CKGM as a compliment to its recently acquired TV station CJNT-DT. Under Rogers ownership, CKGM would have kept its sports talk format, but as a Sportsnet Radio station instead of TSN Radio.[22]

On June 27, 2013, the CRTC approved Bell's acquisition of Astral Media, which closed on July 5, 2013. The deal is subject to conditions, including the requirement to provide fair treatment to its competitors, to not impose "restrictive bundling practices" on Astral's premium movie channels, invest $246.9 million over the next seven years on Canadian-produced programming, and to maintain the operation and local programming levels of all of its television stations through 2017. The CRTC also approved Bell's proposed exemptions for maintaining ownership of CKGM.[23][24]

Divestments

Following the approval of the new proposal by the Competition Bureau, Bell reached a tentative deal to sell 10 radio stations, along with Astral's stakes in Historia, Séries+, and the Teletoon networks, to Corus Entertainment for just over $400 million. Bell also divested Family, Disney Junior (both English and French), Disney XD, MusiMax and MusiquePlus and 5 radio stations at auction.[2] The divested stations and channels were temporarily held in a blind trust by Pierre Boivin until the completion of their acquisitions.[25]

On May 16, 2013, the Jim Pattison Group announced a deal to acquire three stations in Calgary and Winnipeg from Bell and Astral—CKCE-FM, CHIQ-FM, and CFQX, for an undisclosed amount. The deal expanded the Jim Pattison Group's operations in Calgary, where it was also planning to launch the new FM station CHPK-FM, and gave the company its first stations in Manitoba.[26]

On August 26, 2013, Newcap Radio announced its intent to acquire five stations in Toronto and Vancouver from Bell and Astral—CHBM-FM, CFXJ-FM, CKZZ-FM, CHHR-FM and CISL.[27]

On November 28, 2013, the children's television production and distribution company DHX Media announced that it had reached a deal to acquire Family and its sister networks for $170 million.[28][29]

On December 4, 2013, Remstar, owners of the French television system V, announced that it would acquire MusiquePlus and MusiMax—the last of the Bell/Astral properties being sold, for an undisclosed amount.[30]

Corporate governance

Members of the board of directors of Astral prior to the close of the Bell-Astral transaction were: Austin Beutel, Paul Bronfman, André Bureau (chairman), Jack Cockwell, George Cohon, Paul Godfrey, Stephen Greenberg, Ian Greenberg, Sidney Greenberg, Sidney Horn, Timothy Price, Phyllis Yaffe and Monique Jérôme-Forget.

Former Assets

Any listing with a cross (✝) character at the end indicates an asset which was not acquired by Bell Canada.

Radio

Alberta

British Columbia

Manitoba

New Brunswick

Nova Scotia

Ontario

Quebec

NRJ network
Rouge FM network
Boom FM network

Saskatchewan

Television

Over-the-air television stations

Specialty & pay television (English)

Specialty & pay television (French)

Pay-per-view television

External links

See also

References

  1. 1 2 3 http://astral2010.com/pdf/A106655_Astral_FinancialReview.pdf
  2. 1 2 3 "Bell moves closer to Astral with sale of TV assets". Toronto: The Globe and Mail. 4 March 2013. Retrieved 5 March 2013.
  3. ↑ "Bell Canada Ownership Chart - Astral Radio, TV & Specialty Services" (PDF). CRTC. Retrieved 23 August 2014.
  4. 1 2 3 4 Wedge, Pip. "Astral Media Inc.". Radio/Television Station Group History. Canadian Communications Foundation. Retrieved 24 February 2014.
  5. ↑ Astral Media announces signature of letter of intent to acquire Standard Radio
  6. ↑ Astral Shareholders Approve Acquisition by BCE, Broadcaster Magazine, May 24, 2012.
  7. ↑ Astral Receives Final Court Approval for Acquisition by BCE, Broadcaster Magazine, May 25, 2012.
  8. ↑ Johnson, Julia. "Cable company opposition to Bell’s Astral purchase heats up". Financial Post. Retrieved 19 September 2012.
  9. ↑ "CBC challenges BCE-Astral deal". Toronto: The Globe and Mail. 14 September 2012. Retrieved 2 October 2012.
  10. ↑ "Competition Bureau flags Bell-Astral deal". Toronto: The Globe and Mail. 17 September 2012. Retrieved 19 September 2012.
  11. ↑ "Broadcasting Decision CRTC 2012-574". CRTC. Retrieved 18 October 2012.
  12. ↑ "With Astral deal on ropes, BCE keeps its options open". Toronto: The Globe and Mail. 1 November 2012. Retrieved 3 November 2012.
  13. ↑ "As Astral posts gains, Greenberg looks to rescue BCE deal". Toronto: The Globe and Mail. 31 October 2012. Retrieved 3 November 2012.
  14. ↑ "Astral confirms talks with BCE to resurrect takeover deal". Toronto: The Globe and Mail. 16 November 2012. Retrieved 17 November 2012.
  15. ↑ Astral and Bell Comment on New Acquisition Application to CRTC, Broadcaster Magazine, March 6, 2013.
  16. ↑ "Competition Bureau OK's BCE-Astral deal, with conditions". CBC News. Retrieved 5 March 2013.
  17. 1 2 "Competition Bureau clears Corus acquisition of Astral assets". The Globe and Mail (Toronto: Canadian Press). 18 March 2013. Retrieved 20 March 2013.
  18. ↑ "Bell wants to duplicate Quebec’s star system in English Canada". Montreal Gazette. Retrieved 8 May 2013.
  19. ↑ "Bell resistant to CRTC's TSN 690 proposal". Montreal Gazette. Retrieved 8 May 2013.
  20. ↑ "Rogers seeks order that Bell sell Movie Network if Astral takeover is allowed". Canadian Press. Retrieved 8 May 2013.
  21. ↑ "Bell won't sell more of Astral's assets to win OK for merger". Canadian Press. Retrieved 22 May 2013.
  22. ↑ "Rogers tells CRTC it is willing to buy TSN 690". The Gazette. Retrieved 11 June 2013.
  23. ↑ "CRTC approves Bell/Astral deal with conditions". Toronto Star. 27 June 2013. Retrieved 5 July 2013.
  24. ↑ "CRTC approves Bell-Astral merger". CBC. Retrieved 5 July 2013.
  25. ↑ Biblic, Mirko. "Re: Voting Trust Agreement between BCE Inc. and Pierre Boivin, the trustee Application No. 2013-0243-9 – Approved". CRTC. Retrieved 5 July 2013.
  26. ↑ "Pattison group looks to buy castoffs from Bell Astral deal". The Vancouver Sun. Retrieved 22 May 2013.
  27. ↑ "Newcap signs agreement with Bell Media to acquire five radio stations in Toronto and Vancouver". CNW. Retrieved 26 August 2013.
  28. ↑ "DHX Media to buy Family, other children’s channels". Toronto Star. 28 November 2013. Retrieved 29 November 2013.
  29. ↑ "DHX to acquire Family Channel, three others from Bell Media". The Globe and Mail (Toronto). 28 November 2013. Retrieved 29 November 2013.
  30. ↑ "Bell Media signs deal to sell MusiquePlus and MusiMax to V Media Group". Canadian Press. Retrieved 4 December 2013.
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