Rogers Communications Inc.
) plans to gain complete control over sports television network
Score Media Inc. by purchasing its full stake for $167 million. The
transaction awaits shareholder and other customary approvals.
The proposed acquisition of Score Media Inc. will also give
Rogers Communications the right to access television assets of the
Score Television Network that includes Voice to Visual Inc., mixed
martial arts promotion The Score Fighting Series, and The Score
Television Network (exclusive of its digital media business).
Rogers Media, a unit of Rogers Communications, will retain 10%
of the stake in the digital media business - including the
Score.com website and mobile applications - that will be spun out
as a new business before the closing of the deal. The remainder
will be owned by its existing shareholders.
The acquisition of Score Media - Canada's third largest
specialty sports channel - will enable Rogers Communications to
gain additional 6.6 million television subscribers, contributing
$45 million of annual subscription and advertising revenues,
coupled with approximately $15 million of annual EBITDA. This is
expected to not only drive the company's media segment business but
also add more varieties to its Rogers Sports Entertainment
Rogers Communications, which together with Bell Canada, a 100%
), recently bought a 75% stake in Maple Leaf Sports &
Entertainment Ltd., is currently planning to improve its sports
content in order to boost its media segment business.
In the recently concluded second quarter, Rogers Communications
reported dismal results, where both its top and bottom line missed
the Zacks Consensus Estimates.
We maintain our long-term Neutral recommendation for Rogers
Communications Inc. Currently it has a Zacks #3 Rank, implying a
short-term Hold rating on the stock.
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