TORONTO – Blue Ant Media announced Wednesday it will acquire Canadian broadcaster High Fidelity HDTV and its four premium high definition television channels – Oasis HD, eqhd, radX and HIFI HD.
The transaction, which has been rumoured for months, is pending CRTC approval. The deal calls for the company to initially purchase 29.9% of shares in High Fidelity HDTV, with the remaining 70.1% closing subject to CRTC approval. Financial terms of the deal were not disclosed.
Blue Ant Media is a recently established independent media company led by media veteran, former Alliance Atlantis CEO and co-founder Michael MacMillan. In addition to its controlling interest in GlassBOX Television, which operates Travel+Escape, Bite TV and AUX TV, Blue Ant Media also owns a minority interest in Quarto Communications (Cottage Life, Outdoor Canada, Explore and Canadian Home Workshop).
Also announced Wednesday was Torstar Corporation’s purchased of a 25% ownership stake in Blue Ant, which will be valued at $22.7 million once the Hi-Fi HDTV sale is completed (placing the company’s value at $90.8 million). In addition, Providence Equity Capital Markets has committed to providing additional financing to Blue Ant Media as part of the High Fidelity HDTV acquisition.
“We believe it’s a great time to establish and grow a new kind of media company in Canada and our investments in High Fidelity and GlassBOX provide a robust and complementary offering for audiences,” said Michael MacMillan, CEO, Blue Ant Media, in the press release. “We are pleased Torstar Corporation sees the opportunity with our company. Their participation along with Providence will further boost the support of our properties.”
“We view the investment in Blue Ant Media as strategic, providing Torstar with the opportunity to further diversify our Canadian media asset base” said David Holland, president and CEO of Torstar Corporation in that company’s release. “We see the potential in Michael’s vision… and we are very pleased to be involved.”
“It’s a perfect strategic fit for High Fidelity,” added Ken Murphy, president, High Fidelity HDTV. “One that positions our premium channels for continued success in the rapidly changing media environment.”
High Fidelity HDTV and Blue Ant Media intend to quickly submit an application to the CRTC for approval of the acquisition. CIBC World Markets Inc. and GMP Securities L.P. acted as financial advisors to Blue Ant Media.
Months in the making, the acquisition will bring the company’s total number of specialty channels to seven, with at least one more on the way soon as Quarto holds a license for Cottage Life TV. “We’re looking to build scale, to build a new mid-sized independent media company… but always with a focus of core genres of programming,” said Khanna (pictured at right with MacMillan) in an interview Wednesday with Cartt.ca.
Right now the company is focused on entertainment and lifestyle (AUX and HIFI HD and music focused, Travel + Escape, eqhd and Oasis certainly would share viewer demographics and Bite is focused on comedy.)
“We absolutely are incredibly impressed by what High Fidelity has built with Oasis and eqhd. Beyond that, HIFI is largely focused on music, which fits very nicely with Aux and we think radx is a fantastic channel that fits with our other businesses… It’s just the perfect match, in terms of genres and approach.”
Plus, the two companies are already in the same building in Toronto. Glassbox has been running its channels from the High Fidelity HDTV’s master control two floors up at 130 Merton St.
As for the Torstar involvement, Khanna says that will open up a world of opportunities for the TV channels. “From our perspective, we’re thrilled about it. It’s a media company that’s established, well-known, experts in their field and reaches a lot of Canadians on a daily, weekly, monthly basis – and it provides us something that the other vertically integrated companies have that we don’t have, which is that ability to cross-promote, to reach a broad number of people when we have a new property or something to talk about.”
Any chance of launching a news channel with Torstar? ““What a great question. It’s something I look forward to discussing the merits of with Torstar. But we have had no discussions yet… but news is a category that obviously is appealing.”
Now the focus turns to getting the deal approved by the Commission (hard to see any issues there) and building the brands. “We want to turn all of these into great, well-known brands. That takes years not days,” added Khanna.
