PRINCE RUPERT, B.C. – Municipally-owned telco CityTel acquired the remaining Monarch Cable systems last week from owner Bill Yuill and announced an overhaul of its corporate governance, too.
Monarch had approximately 12,000 cable customers in Prince Rupert and the nearby communities of Terrace, Kitimat, Smithers, Houston, Hazelton, Telkwa, Port Edward and Stewart. Monarch was founded in Medicine Hat, Alberta, and Shaw Communications purchased those systems in 2003 for $90 million. Monarch acquired the B.C. systems, the former Okanagan Skeena Group, from Telemedia, in 2000.
The $23.5 million deal is scheduled to close on August 31st, with Commission approval to come afterwards.
While CityTel has been run as an division of the municipality, administered by town council since 1910, the purchase has also led to a re-organization of the company as an arm’s-length corporation which will be overseen by a board of directors which has yet to be named. The new City West Group of Companies will be an independent company with a single shareholder, the municipality of Prince Rupert. The group will include City West Telephone, City West Cable, City West Mobility and City West Fibre.
“It’s kind of like the structure of a Crown Corporation,” Prince Rupert Mayor Herb Pond told www.cartt.ca.
CityTel general manager Rob Brown will run the operation for now.
"This is an exciting time for the people of northern British Columbia," said Mayor Pond. "Northerners are now being served by a truly local telecommunications and cable company. The acquisition means that customers in our region will soon be receiving the same advanced cable and telecommunications services as those south of us."
Prince Rupert is a town of about 15,000 on the Pacific Coast not far from the southernmost border of Alaska. If you’re driving from Vancouver, you’ll be taking a circuitous 1,500 km spin.
There are a number of priorities for the company now, says Pond, such as upgrading the cable plant to digital and finally running fibre into town from the nearest spot – Terrace – about 140 kms away.
While saying it will be up to the new board of directors to decide what’s best for the local company, Pond said that the cable and telecom sides will likely be integrated.
“Offering dial tone through VOIP is a possibility,” he added.
Officially, City West will undertake an extensive capital program over the next five years to achieve its objective of a fully integrated digital communications environment in northwest B.C., delivering a portfolio of voice, data, video and Internet services throughout the region, including the fibre run to Terrace. The link – and the communications infrastructure development will help the city capitalize on existing business opportunities, especially concerning the Port of Prince Rupert expansion. Financing for the acquisition and fibre optic link is being provided by HSBC, the world’s second largest bank.
Monarch employees affected by the acquisition will be offered jobs with City West, bringing the total staff from 35 to 55, says the company.
– Greg O’Brien
