Cogeco in Canada is among the companies now thought to be preparing a bid to buy Astral Media, after regulators blocked the latter’s proposed purchase by Bell Canada Enterprises (BCE).
All eyes turned to the Quebec-based cable company on Friday morning following the stunning rejection by the Canadian Radio-television & Telecommunications Commission (CRTC) of BCE’s C$3.3bn (US$3.3bn) offer.
The CRTC said the Bell/Astral deal would hand too much market share to the already dominant BCE, which owns the CTV network and some 30 cable channels. Cogeco is believed to have placed an offer on Astral when it initially went up for sale earlier this year, only to be outbid by the deep-pocketed BCE.
BCE said it will appeal against the CRTC decision to the federal government, but speculation in the Canadian business press points to a second attempt by Cogeco. Companies such as Quebecor and Shaw Media, which also controls Corus Entertainment, are thought to be too big for a purchase to pass muster with the CRTC.
“It almost falls into Cogeco’s lap and they were interested,” Ron Mayers, a Montreal-based trader at Laurentian Bank, told Canuck newspaper The Globe & Mail.
Cogeco was among the companies that formed a coalition to stop the Bell/Astral deal – warning consumers and regulators that it would hand too much power to BCE.
Toronto-based Rogers Media, with its modest 8.7% share of the market in English Canada, is also thought to be a contender. Rogers – which is keen to extend its reach into eastern and French Canada – has so far said little apart from cheering the CRTC’s ruling as “courageous.”
BCE’s appeal to Ottawa is thought to be a long shot, in part because the CRTC’s newly named chairman Jean-Pierre Blais was hand-picked by Prime Minister Stephen Harper in what some see as a bid to align the regulator’s thinking with that of the government.