The facts about CBC/Radio-Canada’s investment in SiriusXM Canada

March 29, 2012

Satellite radio has had significant success in Canada since its inception in 2005. With over 2 million subscribers, satellite radio remains an important platform for CBC/Radio-Canada that allows its services to be heard across North America. It was and remains a successful strategic investment, in line with the Corporation’s 2015: Everyone, Every way strategic plan.

In 2005, the three founding partners of Sirius Canada – CBC/Radio-Canada, Sirius Satellite radio (US) and Standard Broadcasting (now Slaight Communications) – each invested $12 million to establish the company.

CBC/Radio-Canada held a 25.05 per cent equity interest and a 40 percent voting share in the company. Six CBC/Radio-Canada services were distributed across Canada and the United States from the outset.

Sirius Canada quickly became cash flow positive. Moreover, CBC/Radio-Canada had no liability for the accumulated deficit of Sirius Canada, given that it was a limited Corporation.

In June 2011, Sirius Canada Inc. merged with Canadian Satellite Radio Holdings Inc. (parent company of XM Canada) to create SiriusXM Canada, a company with a market cap of approximately $400 million.

As a result of the merger, CBC/Radio-Canada received:

  • $18 million in cash;
  • A value of $53 million in shares upon closing (June 2011);
  • An extension of its program supply agreement for its 6 channels for an additional 5 years to 2022.

CBC/Radio-Canada has therefore recouped its initial investment and now holds a 14.5 per cent equity interest, a 20 per cent voting interest, and a seat on the Board of Directors of SiriusXM Canada.

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