Arantxa Cedillo / Veras
ZoomerMedia Ltd. , a Toronto company owned by former CITY-TV pioneer Moses Znaimer, says it has struck a deal to acquire religious broadcast channel VisionTV in a move that brings Mr. Znaimer back into the television business.
Under the deal, announced Monday, ZoomerMedia will pay $25-million in cash and shares to acquire the VisionTV specialty channel - an announcement that helped the company's stock more than double on the TSX Venture Exchange.
In addition, ZoomerMedia is acquiring VisionTV's unit that runs CHNU-TV Fraser Valley and CIIT-TV Winnipeg, two Western stations known respectively as Joytv 10 and Joytv 11.
The Toronto broadcaster is also acquiring VisionTV Digital Inc., which holds 47.2 per cent of One: The Body Mind and Spirit Channel Inc. The rest of the company is owned by CanWest Global Communications Corp. , Radio-Nord and Renewal Partners Co.
The purchase, along with a consolidation of private broadcasting assets owned by Mr. Znaimer and other transactions, will see the former CITY-TV head control nearly two-thirds of an expanded ZoomerMedia.
Mr. Znaimer started CITY-TV in the early 1970s and pioneered new approaches to broadcasting that made the station highly successful. It became part of CHUM Ltd., wich was eventually sold to CTVglobemedia Inc. and split up, with Rogers Communications Inc. acquiring the conventional station and its affiliates.
In a related move Monday, ZoomerMedia struck a financing deal that will see insurance giant Fairfax Financial Holdings Ltd. buy 176 million common shares of Zoomer at 10 cents each. That will give Fairfax about 28 per cent of ZoomerMedia.
That financing is conditional on ZoomerMedia acquiring several media and real estate assets currently owned directly or indirectly by Znaimer, the company's president, chief executive officer and majority shareholder.
The assets include:
- MZMedia Inc., which owns radio stations CFMZ-FM, the New Classical 96.3 FM and 103.1 FM and CFZM, Zoomer Radio AM740 in Toronto;
- MZTV Production and Distribution Inc., a television production and distribution business;
- Zoomer Management Ltd., a company that provides creative, production, communications and financial administration services to companies;
- The business which runs the annual Canadian conference known as ideaCity; and an office building in downtown Toronto.
After those deals are complete, Mr. Znaimer will hold 66 per cent of ZoomerMedia and Fairfax 28 per cent.
About $14-million of the $25-million price tag will be paid in cash and the rest, $11-million, will be a promissory note payable over 10 years at an interest rate of 7 per cent a year.
"VisionTV has been broadcasting for 20 years and we believe that this network as well as the Joytv stations and One: the Body, Mind & Spirit channel, will add tremendous value to ZoomerMedia," said Mr. Znaimer.
"These acquisitions will enrich Zoomer's media assets to include radio and television broadcasting, as well as video production. In addition to being attractive businesses in their own right, we expect their complementary nature to Zoomer's magazine and on-line-web holdings will further facilitate the expansion of the Zoomer concept, and will assist CARP significantly in expanding its membership base.
"It also puts me back into TV, where I have a little experience, and a few ideas that should grow shareholder value."
VisionTV president and CEO Bill Roberts said VisionTV and ZoomerMedia are geared towards the same demographic and will form a natural partnership.
"Viewers over the age of 50 represent VisionTV's core audience, making it a natural complement to ZoomerMedia's existing media properties and opening up new opportunities for cross-platform promotion. In addition, ZML and VisionTV share a strong commitment to diversity and high-quality Canadian content," Mr. Roberts said.
VisionTV chairwoman Dale Godsoe added that the agreement with Mr. Znaimer creates new prospects for growth and "will position the channels to prevail in the face of technological and regulatory change."
ZoomerMedia publishes Zoomer Magazine, the largest paid circulation magazine in Canada for seniors, with a paid circulation of 180,000. The company also generates royalty revenue through the provision of exclusive marketing and membership services to CARP, the national group for retirees.