Shaw Communications announced this morning it has sold 100% off its subsidiary Shaw Media to family-owned spin off Corus Entertainment, for $2.65 billion CAD ($1.85 billion in cash; 71 million Corus Class B non-voting shares at $11.21), which includes the likes of Global TV and 19 specialty channels, such as HGTV Canada, Food Network Canada, History Television and Showcase.
Chief Executive Officer, Brad Shaw, said in a statement “With the previously announced acquisition of WIND and sale of Shaw Media, Shaw will be focused on delivering consumer and small business broadband communications supported by its best-in-class wireline, WiFi and wireless infrastructure.”
Corus will gain 34.5% marketshare of English television viewership in Canada, as part of its 45 speciality channels, 39 radio stations and 15 basic channels.
The company explains the net cash proceeds of this transaction, roughly $1.8 billion, will be used to fund their recently announced acquisition of WIND Mobile, at $1.6 billion.
In a note to clients (via WSJ), Aravinda Galappatthige, an analyst with Canaccord Genuity, expects investors to flock towards Shaw and away from incumbents Rogers, TELUS and Bell, saying “With a less-levered Shaw, it is possible that the company can now accelerate its wireless network upgrade plans for Wind and/or become more aggressive on the wireless subscriber acquisition front.”
Get ready to see what Shaw will do with WIND Mobile in 2016, folks.