Date Announced: January 13, 2016
Value: C$2.65 billion
On January 13, 2016, Corus Entertainment Inc. has entered into an agreement to acquire all of Shaw Media Inc. from Shaw Communications Inc. (SCI) for C$2.65 billion to be paid through a combination of cash and Corus Class B shares. The transaction will give Corus ownership of all of Shaw Media's leading brands, resulting in a combined portfolio with significant scale, including 45 specialty television channels, 39 radio stations, digital assets, the content studio, Nelvana and 15 conventional television stations.
On a fiscal 2015 basis, Corus and Shaw Media combined generated about C$1.9-billion in revenue, about C$619-million in adjusted earnings before interest, taxes, depreciation and amortization, and about C$430-million of free cash flow. The transaction is expected to generate C$40-million to C$50-million of annual cost synergies to be realized within 24 months, in addition to significant revenue synergies.
Under the terms of the transaction, Corus has agreed to acquire 100 per cent of Shaw Media for a total purchase price of C$2.65 billion; representing a multiple of about 7.7 times 2015 consolidated reported adjusted EBITDA. Upon closing of the transaction, SCI will receive about C$1.85-billion in cash and about 71 million Corus Class B shares at C$11.21 per share, which is based on current volume-weighted average trading prices on the Toronto Stock Exchange.
Corus Entertainment Inc., headquartered in Toronto, Ontario, is an integrated media and entertainment company.
Shaw Media Inc., headquartered in Calgary, Alberta, is a television broadcasting division of Shaw Communications Inc.
BLG acted as counsel to the Special Committee of Corus with a team led by Frank Callaghan that included Philippe Tardif and Laura Costen.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
