HALIFAX – Newcap Inc. is exploring the possible sale of its western broadcasting assets which are located primarily in Alberta. The assets consist of 32 radio stations, six repeater licences and two TV stations. The sale of the stations would free up Newcap to consider purchasing some of Astral's assets that Bell will likely have to let go if it receives CRTC approval for its takeover.
In Newcap’s last third quarter financials it recorded an impairment charge of $7.5 million related to its television operations in Lloydminster, Alberta. It said the charge resulted from the CRTC decision to discontinue the Local Programming Improvement Fund effective August 31, 2014.
Newcap says it has a history of “buying and selling businesses as a means to create shareholder value.” If Newcap is able to reach an agreement the use of proceeds will be determined by the Board of Directors in the best interests of the company and its shareholders it added in a statement. That may include reinvesting in geographic areas closer to its base in Atlantic Canada, reducing debt or returning capital to its shareholders.
"These broadcasting assets have a strong track record of earnings," commented Rob Steele, President and Chief Executive Officer. "This is a great opportunity for potential buyers as this is the first time in many years that a cohesive group of broadcasting assets has been for sale in one concentrated area in one of Canada's most prosperous provinces."
Newcap cautioned investors that there is no agreement in place to sell the assets and there is no certainty that any transaction will result from the current process.
