Canwest sells two regional television stations

By Scott Anderson

TORONTO (Reuters) - Canwest Global Communications (CGS.TO: Quote), Canada's biggest media company, said on Tuesday that it planned to sell two of its five regional television stations as it struggles to restructure its mounting debt load.

The Winnipeg, Manitoba-based company, which owns Canada's Global television network, Australia's Network Ten and a chain of daily newspapers, agreed to sell CHCH-TV in Hamilton and CJNT-TV in Montreal to private broadcaster Channel Zero Inc.

Financial terms of the deal were not announced.

The move comes almost five months after Canwest said it was reviewing its television strategy with a focus on its Global television brand. CHCA-TV in Red Deer, Alberta, CHBC-TV in Kelowna, British Columbia, and CHEK-TV in Victoria, British Columbia, remain on the auction block.

"The reality is that these stations have not been profitable, so what we are reducing is drag on profitability," said Canwest spokesman John Douglas.

Douglas said the company continues to seek buyers for the remaining three stations, but will wind them up if they cannot reach a deal.

Canwest said the agreement on Tuesday with Channel Zero was conditional on a number of factors including approval from the federal broadcast regulator, the Canadian Radio-television and Telecommunications Commission.

Channel Zero, known for its digital specialty networks including Movieola and Silver Screen Classics, will honor the existing licenses of the two stations, which call for 13.5 hours of local ethnic programing a week at CJNT and 36.5 hours of local programing a week at CHCH.