BCE Inc.’s C$3 billion ($2.9 billion) bid to acquire Quebec specialty-channel provider Astral Media Inc. won approval from Canada’s antitrust regulator, moving the deal a step closer to completion.
BCE agreed to divest channels including Teletoon, MusiquePlus and Disney XD to preserve local competition, the Ottawa-based Competition Bureau said in a statement today. BCE’s amended bid must still be approved by Canada’s broadcast regulator, which rejected the deal in October, saying it would curb television and radio competition.
BCE, based in Montreal, is seeking to consolidate its position as the country’s largest private broadcaster by adding television channels in French-speaking Quebec, including premium services like Super Ecran. Opponents of the bid include Quebecor Inc., which would face intensified competition for its Videotron cable service and TVA television network.
The Competition Bureau said that without the channel divestitures, the acquisition would have “likely have led to increased prices, less innovation and reduced choice for television programming.”
The decision was announced after the close of regular trading. BCE shares rose 0.4 percent to C$46.75 in Toronto as Astral slipped 0.6 percent to C$47.75.
BCE’s Chief Executive Officer George Cope said in a statement that the decision is a “major step forward” to completing the transaction. To help convince regulators to complete the deal, the companies agreed to sell Astral’s share of six television joint ventures, including Teletoon and Cartoon Network, as well as two radio stations to Corus Entertainment Inc. for C$494 million.
A successful purchase of Astral would be Cope’s largest deal to date. He has teamed with Toronto-based Rogers Communications Inc. to buy a controlling stake in Maple Leaf Sports & Entertainment Ltd. in a $1.3 billion deal to own the Toronto Maple Leafs, the most valuable team in the National Hockey League. BCE agreed to buy broadcaster CTV in 2010 for C$1.3 billion in cash and C$1.7 billion in debt, giving it 30 specialty channels, including sports channel TSN.