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CBC was one of three investors that paid $12-million each to create Sirius Canada in 2004, overcoming a groundswell of opposition from privately owned rivals.Nathan Denette/The Canadian Press

Amid all the slashing at the CBC, there's a bright spot: the People's Broadcaster has made a small fortune on its investment in satellite radio.

And as the beleaguered broadcaster struggles to cut $115-million from its $1.1-billion in federal funding over the next three years, its decision to get in on the early days of satellite radio could be about to pay dividends – literally.

Canadian Satellite Radio Holdings Inc., in which the CBC owns a significant minority stake, has an increasingly large pile of cash that has analysts anticipating a quarterly payout to investors that would be a welcome boost to the CBC's bottom line.

"A material dividend could be considered within 12 to 18 months," National Bank Financial analyst Adam Shine said, although sources close to the company, which operates as SiriusXM Canada, suggest a dividend could come sooner as it considers what to do with a $35-million cash pile that is growing by about $9-million a quarter.

CBC was one of three investors that paid $12-million each to create Sirius Canada in 2004, overcoming a groundswell of opposition from privately owned rivals who opposed CBC's expansion plans and angrily demanded the broadcaster stick to its core mandate.

Eight years later, any risk the broadcaster assumed is long gone. The satellite radio company it founded merged with its only competitor last year, earning CBC an $18-million cash payout. It also received a stake in the new company, which is worth about $53-million as of yesterday's market close.

"Essentially, CBC got their investment worth $50-million today for free," said John Bitove, chairman of SiriusXM Canada. "It was a brilliant deal even without the channels and content agreement. "

CBC has no plans to sell the shares.

SiriusXM Canada reports its second-quarter earnings on Thursday. In its last quarter, it saw revenue increase 6.6 per cent to $63.1-million as it posted a $3-million loss. The loss was largely owing to non-cash charges, so it was able to increase its cash on hand to $35.2-million with a $9-million contribution.

Analysts are looking to a profitable future for the service, with all four who follow the company's shares rating them a "buy" with a price target of $4.63 – 46 per cent above yesterday's close. The company's shares have traded in a tight range this year, but are up about 21 per cent from six months ago.

While relatively mainstream in 2012 with two million Canadian subscribers, satellite radio was in its infancy when CBC began exploring a partnership with U.S.-based Sirius Satellite and Standard Broadcasting to bring the service to Canada. The strategy was developed in 1999, as the broadcaster looked to expand its "constellation" of offerings.

CBC's move toward satellite radio caused detractors to scold the corporation for straying too far from its mandate, and extensive hearings were held by the federal broadcast watchdog to determine whether satellite radio would work under Canada's regulatory system.

Indeed, the only thing many Canadians knew about the service as it wound its way through the regulatory process was that controversial radio host Howard Stern had signed a $500-million (U.S.) contract to do a show on the fledgling service, something detractors seized on as further proof that the Canadian broadcaster was straying too far from its mission.

"The CBC already has a considerable constellation of services," the president of the Canadian Association of Broadcasters said at the time. "The CBC has stretched the resources at its disposal to the point that it is having trouble maintaining existing services."

While the public broadcaster is now a permanent fixture on satellite radio with contracts guaranteeing it six channels until at least 2022, dividend payments wouldn't be considered a permanent revenue stream for the broadcaster.

It has announced a series of measures to raise money, including divesting real estate worth an estimated $1-billion (Canadian) and selling advertising on CBC Radio 2 – something it has not done on its satellite channels.