Canada's BCE to acquire Astral Media for C$3 billion
By Euan Rocha
TORONTO (Reuters) - Bell Canada's parent has agreed to buy Astral Media, its largest content provider, in a C$3 billion ($3.02 billion) deal to lock up more of the programming carried over its media platforms and expand its presence in French-speaking Quebec.
Complementing BCE Inc's C$1.3 billion acquisition of CTV last year, the deal announced on Friday highlights the company's drive to control the costs of the content distributed through its cable, internet and telecom properties.
BCE's strategy is part of a global trend - the growing popularity of tablet computers and smartphones as platforms to view content has blurred the lines separating telecom carriers, media and cable companies. That has forced providers to venture outside their traditional domains to boost revenues and win a competitive edge.
"All telephone companies are trying to reinvent themselves," said Macquarie analyst Greg MacDonald. "Carriers, cable and telephone companies are buying content providers, and even going so far as to buy the content itself."
BCE, already Canada's largest telecom provider, will acquire more than 20 television services operated by Astral, including HBO Canada, the Movie Network, Canal Vie and Disney Junior. In radio, the deal gives BCE 80 stations, including Virgin Radio, EZ Rock and Boom.
In an important aspect of the deal, Astral positions BCE to compete more effectively against Quebecor Inc, which owns a rich array of French-language content and rival telecom company Videotron that operates in the province of Quebec.
Astral - based in Montreal along with Quebecor - has a strong presence in Quebec, Canada's francophone heartland. Its assets will enable BCE to raise its profile in one of Canada's biggest media markets and broaden out its national footprint.
"Bell's acquisition of Astral firmly establishes our company as Québec's media leader," said BCE Chief Executive George Cope. "The acquisition also represents content cost certainty for Bell, as Astral represents Bell's single largest content cost in our TV business today." Continued...