ARCHIVED -  Decision CRTC 94-435

Decision

Ottawa, 22 July 1994

Decision CRTC 94-435

Northern Cable Holdings Limited

Burks Falls, Bonfield, Britt, Bruce Mines, Belle Vallee, Blind River, Cartier, Charlton, Calstock, Cobalt, Cochrane, Corbeil/Astorville, Desbarats, Elk Lake, Elliot Lake, Emsdale/Kearney, Englehart, Espanola/McKerrow/Webbwood, Fauquier, Field, Foleyet, Gogama, Hallebourg, Harty, Hearst, Hilton Beach, Holtyre/Ramore, Hornepayne, Iron Bridge, Iroquois Falls, Jocko Point, Kapuskasing/Val Rita, Kamiskotia, Killarney, Lavigne, Latchford, Little Current, Loring/Port Loring, Magnetawan, Markstay, Manitowaning, Mattice, Matachewan, Mindemoya, Moonbeam, Massey, Matheson, Mattawa, Nairn Centre, Nellie Lake, New Liskeard/ Haileybury/North Cobalt, Noelville, Opasatika, Powassan, Providence Bay, Richards Landing, River Valley, Sundridge/South River, Serpent River, Skead, Smooth Rock Falls, Spanish, St. Charles, Sturgeon Falls/Cache Bay, Thessalon, Temagami North, Temagami South, Timmins, Trout Creek, Verner, West Bay Indian Reserve, Whitefish Falls, Wikwemikong, Warren/Hagar, Ontario andSudbury, Ontario - 940076300

Transfer of control

Following a Public Hearing in the National Capital Region beginning on 20 June 1994, the Commission approves the application for authority to transfer effective control of Northern Cable Holdings Limited and its wholly-owned subsidiary Sudbury Cable Services Limited, licensees of the cable distribution undertakings serving the above-noted communities, through the transfer of all the issued and outstanding shares to CFCF Inc.

CFCF Inc., is a diversified Canadian communications firm. It is the licensee of the English-language television station CFCF-TV Montréal, and also operates the French-language television network Quatre-Saisons (TQS), which covers the province of Quebec through its stations CFJP-TV Montréal, CFAP-TV Quebec City, CJPC-TV Rimouski, and several affiliates. CFCF Inc. also owns two subsidiaries involved in production: Productions Champlain Inc., which operates the Montréal post-production firm Supersuite, and Conseillers Vidéo R.S. Ltée, a company specializing in the direct rebroadcasting of sports events. CFCF Inc. also presently operates two cable distribution undertakings serving approximately 280,000 subscribers, namely, CF Cable TV Inc., serving the western part of Montréal and Laval; and Télécâble Laurentien Inc., serving Hull, Aylmer, Gatineau, Cantley, Chelsea, Buckingham and Masson-Angers in Quebec, and Rockland and Clarence Point in Ontario.

The purchase price for the shares is $108,500,000, subject to adjustment. 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 communities served by the broadcasting undertakings and to the Canadian broadcasting system as a whole, and that it is in the public interest.

The Commission has assessed the total benefits package, including quantifiable benefits amounting to $11,200,000, and, in general, is satisfied that it is significant and unequivocal, and that approval of this application is in the public interest.

Among the proposed tangible benefits, the Commission notes technical improvements to the various systems, improvements to community programming and a contribution to the concept of a "head end in the sky" which will allow small and medium cable operators, in competition with foreign direct broadcasting satellites, to access multi-channel pay-per-view and other signals for the benefit of their subscribers.

With respect to those undertakings regulated under Part III of the Cable Television Regulations, 1986 (the regulations), the Commission reminds the purchaser of its longstanding policy that subscribers should not be required to pay higher fees merely because the ownership or control of a cable television system has changed hands.

With respect to Class 1 and Class 2 undertakings, the Commission considers CFCF Inc.'s undertaking that the costs associated with the benefits package outlined in this decision will not form part of any fee filing under subsections 18(6) and 18(8) of the regulations to be an important element of this application.

In Public Notice CRTC 1992-59 the Commission announced implementation of its employment equity policy. It advised licensees that, at the time of licence 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 the licensee to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.

The Commission notes the interventions in support of this application submitted by the Regional Municipality of Sudbury and the City of Timmins, as well as by several licensees of specialty and pay television services.

The Commission also acknowledges interventions from various community groups in the Sudbury area expressing support for the carriage of the Telelatino Network on the undertakings in question and, in particular, a letter from the Telelatino Network to CFCF Inc. The Commission has noted CFCF Inc.'s positive response to that letter.

Allan J. Darling
Secretary General