In late July, the entertainment division of CanWest Entertainment – the third most powerful Canadian broadcaster and now the country’s most endowed media giant – struck a US$100-million deal with Dutch TV giant Endemol Entertainment to buy its international distribution unit – effectively doubling the size of CanWest Entertainment’s library and positioning the company as the number one television distributor in Canada.
‘The Endemol acquisition will contribute to a substantial growth in revenues, operating profits and net earnings at CanWest Entertainment for fiscal 2001 and beyond,’ says CanWest Entertainment CEO Jay Firestone. (Endemol, creator of the reality series Big Brother, is in the process of being bought out by Spanish telecom giant Telefonica in a deal worth $4.5 billion.)
Endemol International Distribution, whose library holds 600 hours, will be folded into Fireworks International, CanWest Entertainment’s international TV distribution arm, headquartered in London, U.K. In addition to gaining distribution rights to the existing library, CanWest will also have the first look at future TV programs produced by Endemol Entertainment in the next year and will assume Endemol’s existing program acquisition commitments.
‘[The Endemol deal] puts Fireworks up into another league. They’ve gone from being a mid-sized player to the biggest in Canada,’ says William Alexander, president of Toronto-based distributor Critical Mass Releasing.
But while Alexander acknowledges that ‘everybody’s trying to grow for the global market,’ he sees big opportunity for the relatively small player. ‘[The big guys] will be focusing on mass distribution, leaving smaller markets, smaller projects and independent talent open for the smaller distributors.’
CanWest also recently struck a US$2.4 billion deal – the largest deal in the history of the Canadian media industry – when it agreed to acquire 100% of Hollinger International’s 13 principal Canadian metropolitan newspapers, all of its Canuck Internet properties, its magazine group and 130 of its community newspapers, as well as 50% of the National Post, a Canadian daily. The deal unites the conventional media of print and electronic content with the online, interactive technology of the Internet.