Canada’s second largest cable company Shaw Communications yesterday announced the purchase of rival Moffat Communications for C$1.2 billion ($790m).
Randall Moffat, chief executive and majority shareholder of the eponymous firm, will join Shaw’s board. The deal involves a $400m (35%) payment in cash and the rest in shares. The price represents an 8.5% premium on Moffat’s share price at close of trading on Wednesday.
Acquiring Moffat adds a further 320,000 subscribers to Shaw’s existing base of 2.3m. Since three-quarters of these new customers are located in five western Canadian cities, the purchase strengthens Shaw’s near-dominance of the nation’s western cable market.
Shaw will also acquire Moffat’s speciality TV channels, which observers believe may be sold on to Corus Entertainment, a Shaw subsidiary owning a number of speciality channels.
News source: Financial Times