Canwest: Shaw gets approval, Torstar makes bid

Two bits of news out of Winnipeg today: Shaw communications will buy
part of Canwest’s broadcast division from Goldman Sachs, and Torstar has
submitted a formal bid for the beleaguered media company’s newspaper

The Shaw deal and the Torstar bid come as Canwest has been restructuring
its broadcasting and publishing business under protection from

The Toronto Star, which is owned by Torstar, reports:

“Torstar Corp. says it submitted a formal offer on Friday, putting to rest speculation that the publisher of Canada’s biggest newspaper was having trouble lining up its financing.”

“The banks who effectively own Canwest have set a floor price of $950 million.”

“Torstar is not the only bidder for the Canwest newspapers, which include the National Post, Montreal Gazette and Ottawa Citizen.”

“Other reported bidders for the Canwest papers include Victoria-based David Black and Vancouver’s Glacier Media, which owns many newspapers in B.C. and elsewhere. Former Canwest CEO Leonard Asper, who lost control of the newspaper and broadcasting company his father built, is also part of a bid to reclaim the papers, once known as the Southam Newspaper Group.”

On the Shaw deal, The Globe and Mail reports:

“Shaw Communications Inc. said Monday it plans to buy part of CanWest Global Communications’s broadcast division from Goldman Sachs Group Inc. for $700-million, paving the way for the Western cable giant to take full control of CanWest’s TV assets.”

The Globe and Mail continues:

“In February, Shaw won court approval to invest in the broadcast assets of a restructured CanWest, including the Global television network and some specialty channels. However, 65 per cent of the lucrative stable of specialty stations CanWest acquired from Alliance Atlantis Communications Inc. in 2007, called CW Investments Co., remained under Goldman’s control.”

“In March, Goldman filed an appeal on the Shaw decision, with the support of private equity firm Catalyst Capital Group. This deal puts an end to that dispute with Goldman.”

“The Calgary-based communications company will now pay Goldman in cash and through its existing credit facility for the disputed specialty TV assets. It will also assume $815-million of net debt, valuing Monday’s agreement at about $2-billion.”

“The deal between the Calgary-based cable company and New York-based investment bank clears the way for Shaw to buy all of a restructured CanWest. Shaw has said it wants only CanWest’s television and specialty cable TV properties.”

“We believe the combination of content with our cable and satellite distribution network, and soon to be wireless service, will position us to be one of the leading entertainment and communications companies in Canada,” said Jim Shaw, Shaw’s chief executive officer, in a release.

“CanWest creditors will get $478-million in cash as part of a plan to be implemented under the Companies’ Creditors Arrangement Act.”

“The plan is subject to certain conditions, including CanWest creditor and court approvals. The deal also needs regulatory approvals from the Canadian Radio-television and Telecommunications Commission and the Competition Bureau.”