ARCHIVED -  Decision CRTC 99-471

Decision

See also: 99-471-1

Ottawa, 18 October 1999

Decision CRTC 99-471

Okanagan Skeena Group Limited

British Columbia, Alberta and Northwest Territories -199907929

Application processed by
Public Notice CRTC 1999-151
dated 10 September 1999

Transfer of control

1. The Commission approves the transfer of ownership and control of Okanagan Skeena Group Limited (Okanagan) through the transfer of all of its issued and outstanding shares to Telemedia Radio Inc. (Telemedia Radio) a wholly-owned subsidiary of Telemedia Communications Inc. (Telemedia).

2. Initially, Okanagan had applied for the transfer of its shares to TCI Acquisition Corporation (TCI). However, on 31 August 1999, by letter of authority A99-0113, the Commission approved the merger of Okanagan with TCI. The resulting company kept Okanagan's name. Also, Telemedia advised the Commission that, effective 1 September 1999, 3581713 Canada Inc. amalgamated with Telemedia Radio. As a result of these mergers, Telemedia Radio is now the company that acquires the shares of Okanagan.

3. Okanagan currently owns and operates several radio stations, television stations and cable distribution undertakings in British Columbia, Alberta and the Northwest Territories. TCI's acquisition of these undertakings will allow Telemedia to enter markets where it is not currently active.

4. The overall purchase price for this transaction is $92,900,000. Based on the evidence filed with the application, the Commission has no concerns with respect to the availability or adequacy of the required financing.

5. Consistent with the requirements of the benefits test outlined in Public Notice CRTC 1998-41 entitled Commercial Radio Policy 1998, the benefits offered with respect to the radio sector represent the required minimum direct financial contribution to Canadian talent development of $2,316,000, or 6% of the $38,600,000 purchase price for the radio stations. The benefits expenditures will be spent over five years. TCI will allocate 3% each year to the new Canadian Music Marketing and Promotion Fund, 2% to FACTOR and 1% to local initiatives.

6. The contribution which is to be allocated to the Canadian Music Marketing and Promotion Fund must be directed to the Canadian Association of Broadcasters who will hold all contributions in trust pending the creation of this fund.

7. Consistent with the requirements of the benefits policy outlined in Public Notice CRTC 1999-97 entitled Building on Success - A Policy Framework for Canadian Television, TCI will spend $230,000 in tangible benefits in the television sector, or 10% of the $8,300,000 purchase price for the television stations. Specifically, TCI will allocate $55,000 each year to the Jack Webster Foundation for a fellowship for a broadcast journalist who wishes to return to school to pursue professional development. TCI will also contribute $111,000 each year for bursaries and scholarships for students in communities where Okanagan operates. This contribution will enable these students to attend programs in communications, media studies, broadcast journalism or broadcast technology in educational institutions in western Canada. Fifteen to twenty scholarships will be awarded each year for five years.

8. These commitments are over and above the stations' existing commitments and conditions of licence.

9. Okanagan, as a benefit of the transfer of control of Mega Communications Ltd. (licensee of CJDC-TV and CJDC-AM) to Okanagan approved in Letter of Authority A97-0136 (Public Notice CRTC 1997-131) proposed benefits totalling $450,000. Of this amount, $300,000 was for a proposal to construct a digital radio transmitter at Kelowna and made available rent free for the first licence term. Although the Commission did not accept construction of the transmitter as a tangible benefit of this transaction, it nevertheless required that this initiative be implemented as proposed. TCI confirmed that it would undertake to fulfil the benefits related to scholarships (to date $84,000 of the $150,000 has been spent). It stated, however, that "digital technology has not progressed as quickly as anticipated." TCI did not undertake to construct the transmitter but stated that it "will continue to monitor the progress of digital radio technology".

10. Consistent with its policy that benefits commitments are part of the obligations of a licensee and should be implemented regardless of ownership changes, the Commission requires TCI to either construct the transmitter or propose to the Commission other suitable initiatives for the $300,000.

This decision is to be appended to each licence. It is available in alternative format upon request, and may also be viewed at the following Internet site:
www.crtc.gc.ca

Secretary General