Follows CRTC’s rejection of WildBrain’s ‘undue disadvantage’ claim against Bell
WildBrain announced Monday it has begun renegotiations with Halifax-based children’s studio IoM Media Ventures on certain commercial aspects of their previously announced agreement whereby IoM is to acquire a majority stake in WildBrain’s TV broadcast business.
When announced in December 2024, the transaction was valued at more than $40 million. Under the terms of the agreement, IoM was to acquire 66 2/3 per cent of WildBrain’s TV business, including Family Channel, Family Jr., WildBrainTV and Télémagino.
While the deal itself is still subject to CRTC approval, WildBrain said Monday it is currently having to renegotiate with IoM after the broadcast regulator in mid-March dismissed WildBrain’s complaint against Bell that alleged the large telecom was disadvantaging its children’s programming by giving an undue preference to Corus in the English-language markets.
Following the CRTC’s decision, WildBrain has been unable to negotiate a new carriage agreement for its four channels with Bell, and has been informed by Bell that the telecom intends to remove the channels from its distribution service, WildBrain said in a Monday press release.
“Bell’s decision to remove the Channels from its distribution service will require us to revise certain aspects of the transaction with IoM, but we are optimistic we can arrive at a deal that works for both of us,” Josh Scherba, WildBrain’s president and CEO, said in the press release. “As one of only a few independent companies operating kids’ and family channels in Canada, we are greatly disappointed that we could not come to an arrangement with Bell to continue supporting the Channels.
“For almost four decades, our Channels have played a vital part in the Canadian content landscape, providing opportunities for Canadian producers and artists to share their stories with audiences across the country. In fact, in just the last five years, our Channels have greenlit more than 15 season of original Canadian productions,” Scherba said.
WildBrain “remains strong and vibrant” with “operations and partnerships worldwide generating robust revenues across our 360-degree capabilities in consumer products licensing, content production and audience engagement,” he added.
The sale of its channels is part of WildBrain’s overall strategic objective to simplify and streamline its business to focus on key franchises, such as Peanuts, Strawberry Shortcake and Teletubbies, he said.
“This strategy has not changed, and we have a clear path ahead as we continue in our commitment to harnessing high-growth opportunities and cash generation,” Scherba said. “Once we complete the IoM transaction, or exercise alternate options regarding control of the Channels, WildBrain will no longer be subject to applicable Canadian control restrictions under the Broadcasting Act. We then intend, in due course, to remove our variable voting structure currently applicable to non-Canadian shareholders. Moving forward, simplifying our voting structure to a single class will be a highly meaningful milestone in our trajectory, providing greater strategic flexibility and opportunities for WildBrain.”
WildBrain is maintaining its fiscal year 2025 outlook and will provide additional detail on its long-term strategy and ongoing operations during its upcoming fiscal third quarter 2025 earnings call, the company said.
