TORONTO – Goldman Sachs is appealing an Ontario court’s decision to allow Shaw Communications to proceed with its takeover of debt-laden CanWest Global.
The move means that the bid put forth by Toronto-based investment fund Catalyst Capital, the Asper family and former Rogers execs Rael Merson and John Tory, is still in play.
In documents filed in court this week, Goldman Sachs, which financed CanWest’s purchase of specialty channels from Alliance Atlantis back in 2007, appears to be pulling out all the stops to protect its investment, while accusing the new buyers of trying to pick up the specialties as cheaply as possible through CCAA maneuvering.
"This CCAA restructuring proceeding… has involved a remarkable abuse of the CCAA’s process and a total failure of Canwest’s corporate governance for the purpose of extracting the most value possible for the Noteholders, rather than an effort to produce the most viable restructuring consistent with applicable CCAA protocols and the interests of other constituencies”, the document reads.
In its appeal, Goldman Sachs has asked that the court:
– set aside approval of the Shaw agreement;
– direct CanWest to “consider alternative restructuring proposals that were wrongly rejected”;
– direct CanWest to negotiate a subscription agreement with Catalyst consistent with its offer;
– direct the Monitor to report on the restructuring alternatives available to CanWest; and
– permit full disclosure and examination of evidence pertaining to a renewed motion to approve a new investment in CanWest.
In related news, Cartt.ca has learned that speculation around whether the Catalyst/Asper bid would be free from an obligation to pay benefits may be inaccurate. Contrary to some media reports, should this bid prevail and the CRTC determine that a change in control of CanWest had occurred, it could enforce the benefits policy whereby 10% of the purchase price must be committed to Canadian content. Should the Shaw bid win out, they would be obligated to pay benefits.
– Lesley Hunter with files from Greg O’Brien
