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ARCHIVED -  Decision CRTC 94-925

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Decision

Ottawa, 19 December 1994
Decision CRTC 94-925
Key Radio CFNY Limited
Brampton, Ontario - 940552300

Transfer of Control and Licence Renewal for CFNY-FM - Approved

Following a Public Hearing in the National Capital Region beginning on 20 September 1994, the Commission approves the application by Key Radio CFNY Limited, licensee of CFNY-FM Brampton, for authority to transfer effective control of the licensee through the transfer of 1000 common shares from Rogers Communications Inc. (RCI) to Shaw Communications Inc. (Shaw).
The Commission also renews the broadcasting licence for CFNY-FM from 1 September 1995 to 31 August 1999, subject to the conditions in effect under the current licence, as well as to those conditions specified in the licence to be issued.
Although the licence term granted herein is less than the maximum of seven years permitted by the Broadcasting Act, this is for the purpose of enabling the Commission to consider the next licence renewal of this undertaking in accordance with the Commission's regional plan.
In Decision CRTC 94-923 issued today, the Commission approves the transfer of all of Maclean Hunter Limited's (MHL) issued and outstanding shares, representing effective ownership or control of Key Radio CFNY Limited and all of the other broadcast properties owned by MHL to RCI. In the present decision, the Commission approves the transfer of the effective control of the Brampton radio station onward to Shaw.
Shaw is controlled by virtue of a voting trust by James R. Shaw of Edmonton. Currently, through its wholly-owned subsidiary, Shaw Radio Ltd., Shaw owns eight radio stations in western Canada and two stations in Ontario. According to Shaw, in acquiring CFNY-FM, it is seeking to provide geographic balance to its radio holdings and to strengthen its radio operations in Ontario.
The purchase price for the shares is $16,750,000. Based on the evidence filed with the application, the Commission has no concerns with respect to the availability or the adequacy of the required financing.
Because the Commission does not solicit competing applications for authority to transfer effective control of broadcasting undertakings, the onus is on the applicant to demonstrate to the Commission that the application filed is the best possible proposal under the circumstances, taking into account the Commission's general concerns with respect to transactions of this nature. As a first test, the applicant must demonstrate that the proposed transfer will yield significant and unequivocal benefits to the community served by the broadcasting undertaking and to the Canadian broadcasting system as a whole, and that it is in the public interest.
In particular, the Commission must be satisfied that the benefits, both those that can be quantified in monetary terms and others that may not easily be measured in terms of dollar value, are commensurate with the size of the transaction and take into account the responsibilities to be assumed, the characterictics and viability of the broadcasting undertakings in question, and the scale of the programming, management, financial and technical resources available to the purchaser.
The Commission has assessed the benefits package identified by Shaw as flowing from this transaction and, in general, is satisfied that it is significant and unequivocal, and that approval of this application is in the public interest.
Shaw proposed tangible benefits of $1,560,000 in direct expenditures over five years.
In addition to the benefits proposed as part of the ownership transaction, Shaw also made a commitment as part of CFNY-FM's license renewal application to contribute $80,000 annually to continue the station's existing Canadian talent development initiatives. Specifically, Shaw will contribute $55,000 annually to the CASBY Awards as well as $25,000 annually to the New Music Search.
The Commission notes that Shaw's commitment to spend $80,000 annually on Canadian talent development represents $20,000 more than the amount proposed for the year 1994-1995 by the licensee, under MHL's ownership, in an application to reduce CFNY-FM's annual expenditures on Canadian talent development. That application was approved in Decision CRTC 94-922 of today's date for the reasons set out therein.
In Public Notice CRTC 1992-59, the Commission announced implementation of its employment equity policy. It advised licensees that, at the time of license renewal or upon considering applications for authority to transfer ownership or control, it would review with applicants their practices and plans to ensure equitable employment. In keeping with the Commission's policy, it encourages Shaw to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.
The Commission acknowledges all of the interventions submitted regarding this application and has noted both the supporting interventions as well as the applicant's responses to concerns expressed in some interventions.
Allan J. Darling
Secretary General
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