BCE's $2.9 billion Astral purchase clears a hurdle in Canada

Mon Mar 4, 2013 6:11pm EST
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By Alastair Sharp

TORONTO (Reuters) - Canada's Competition Bureau has approved BCE Inc's plan to acquire Astral Media Inc for C$3 billion ($2.9 billion), but the Bell parent's offer to buy the media company must still pass muster with the telecommunications regulator.

The competition watchdog said on Monday its approval carried the condition that BCE, a growing broadcaster, must sell some of Astral's pay and specialty television channels, including several Disney channels.

In addition, the bureau said BCE must not impose "restrictive bundling requirements" on any rival provider seeking to carry Astral's flagship movie channels in either English or French.

"It is starting to look more like the breakup of Astral rather than a simple merger with Bell," said Michael Geist, an University of Ottawa academic focused on law and technology. "The bigger question of whether this transaction meets the public interest test at the CRTC remains an open question."

Critics, including BCE's rivals, had complained that an enlarged BCE would use its clout as a content owner to push costs higher across the industry or promote exclusive content over its television and Internet services to poach subscribers.

In a deal that closed in 2011, BCE bought CTV, Canada's largest private broadcaster, giving it leading news and sports channels.

BCE will retain eight Astral TV services, all in French except The Movie Network, it said in a separate statement.

It said Corus Entertainment Inc would buy Astral's share of six television joint ventures as well as two radio stations for C$400.6 million, and that a process is under way to sell more assets.   Continued...

Canadian Radio-television and Telecommunications Commission Chairman Jean-Pierre Blais speaks during a news conference in Gatineau, Quebec October 18, 2012. REUTERS/Blair Gable