BCE submits new $3.38-billion proposal to buy Astral

MONTREAL – Bell Canada and Astral Media Inc. have submitted a new proposal to the federal broadcast regulator, saying they’ve found ways to address the CRTC’s concerns over the level of ownership concentration in some markets.

The companies say in the joint announcement Monday that the revised deal is worth $3.38 billion, subject to approval by the CRTC and the Competition Bureau — about the value as the original deal.

Bell Canada’s parent (TSX:BCE) originally agreed in March to buy Montreal-based Astral (TSX:ACM.A) for $3.4-billion but the CRTC killed the deal last month — saying Bell would end up with too much market share in some areas, despite the companies’ view that they had stayed within regulatory thresholds.

“We heard Canadians and the CRTC loud and clear — they want assurance that Astral joining with Bell Media will directly benefit consumers and creators,” BCE chief executive and president George Cope said in the statement.

“We’re ready to deliver more choice for listeners and viewers, more opportunity for content creators, and more competition for the broadcasting industry,” Cope said.

“Bell and Astral are happy to move forward with a new proposal that benefits all Canadians, in both official languages, in communities large and small across the nation, with new ideas, new funding and new choices.”

Ian Greenberg, president and CEO of Astral Media, said the companies are “committed to making sure that the consumer always comes first.”

He repeated the two companies’ position that there will need to be “constant investment and innovation” in a rapidly changing media landscape, where foreign broadcasters are having an greater impact.

“Together, Astral and Bell Media have the scale to invest, compete and deliver on the opportunities ahead for all Canadians,” Greenberg said.

They’re aiming to close the deal by June 1, although each company has the right to postpone the closing date to July 31.

The companies say their new proposal includes a “revised package of tangible benefits” to support Canadian TV and radio content, promote home-grown talent and engage consumers in the broadcasting system.

Bell has also asked for an CRTC exception to allow the Montreal station TSN Radio 690 (CKGM) continue to operate as an English-language sport talk radio channel.

Bell and Astral say details of the new Astral-Bell proposal will be made available by the Canadian Radio-television and Telecommunications Commission when it launches a public consultation on the application.

BCE will continue to pay about $50 per class A share of Astral (TSX:ACM.A) and $54.83 per class B share (TSX:ACM.B), including a combination of cash and up to $750 million of BCE shares.

However, the agreement between the companies will be amended so that Astral can pay its shareholders a dividend of 50 cents on Feb. 1 to shareholders of record as of Jan. 15.

Astral Media owns 25 TV specialty services including the Movie Network, and more than 80 radio stations.

Bell has postponed the deadline for the deal until Dec. 16 and both parties can further extend it by one month.