BUSINESS

A global vision

Izzy Asper plans a national TV network

JOHN DeMONT February 5 1990
BUSINESS

A global vision

Izzy Asper plans a national TV network

JOHN DeMONT February 5 1990

A global vision

BUSINESS

Izzy Asper plans a national TV network

The showdown had all the drama of a make-or-break blackjack game. After a four-year legal struggle, Israel (Izzy) Asper and his estranged partners, Paul Morton and Seymour Epstein, faced each other in a Winnipeg boardroom at 9:30 a.m. on Dec. 14 for a winner-take-all play for Global Communications Ltd., owner of the lucrative Global television system. Refereeing the contest for the Ontario-based TV network was a court official equipped with a hand-held stopwatch to ensure that neither side exceeded the 30minute time limit for bids. Morton and Epstein opened at $125 million. The ante was raised 14 times over the next 70 minutes. Then, at 10:40 a.m., Morton and Epstein dropped out, leaving a surprised, exhausted Asper with his rich prize. “It was like having a 200-lb. weight lifted off your shoulders,” he recalled. “I felt in need of a long holiday.” But, instead of enjoying his moment of triumph, the Winnipeg entrepre-

neur is now embarked on realizing another undertaking—turning Global, and a string of independent stations, into Canada’s third national television network.

Izzy Asper, 57, has been known as a big thinker for years. When he was just 24 and attending law school at the University of Manitoba in Winnipeg, he decided that a narrow legal career would dampen his sweeping ambi-

THE BATTLE FOR VIEWERS

The networks' alt-day average percentage share of television viewers in Ontario.

CTV..................... 18

CBC....................................14

Global.................................*12

‘Global does not serve Northern Ontario

Source: Bureau of Broadcast Measurement for November, 1988.

tion. Since then, the combative workaholic’s professional life has been wide and varied—tax lawyer, politician and corporate acquisitor— and marked by success and setbacks. But now, if the Canadian Radio-television and Telecommunications Commission (CRTC) upholds his Global purchase, for which he expects to file an application in early February, he may at last have found his true calling.

With his raspy voice and tired, dark-circled eyes, the chain-smoking, Winnipeg-based entrepreneur looks as though he is more at home in the New York City jazz clubs he likes to frequent than in the corporate boardrooms where his large ego and aggressive style often upset more traditional executives. But Asper’s friends and associates in the tight-knit Winnipeg business community are fiercely loyal to the native son who combined unflagging ambition and a knack for corporate strategy to build a national business empire without ever abandoning his home base. Says Arni Thorsteinson, executive vice-president of Winnipeg-based Shelter Corp. of Canada Ltd., a real estate and development firm: “Izzy is one of the true visionaries of Canadian businesss.”

Having won the contest for Global, Asper is forging ahead with his bold plan to build a

nationwide, co-operative system of independent television stations capable of taking on the giant Toronto-based CTV Television Network Ltd. and the Canadian Broadcasting Corp. (CBC). Global’s Toronto-based operation in Ontario reaches 12 per cent of television viewers in the province on an average night. At the same time, it has developed some strong homegrown news and entertainment shows, including T&T, starring Mr. T and Torontonian Alex Amini, Adderly and the popular children’s show Care Bears. The Toronto station would serve as the flagship station in a network. The system’s reach already extends to Winnipeg, Regina, Saskatoon and Vancouver, where Asper’s CanWest Capital Corp., a privately owned merchant-banking venture, owns independent television stations affiliated with neither of the major networks. He also hopes to soon operate independent stations in conjunction with other parties in major markets in Alberta, Quebec and the Atlantic provinces, where CanWest does not now have a presence.

Under Asper’s plan, the individual stations would be free to independently develop g and broadcast local programs' ming—and would pool their I resources to create more amo bitious programs for a nation£ al audience. If that happens,

£ Asper says he will have a fully s operational national network.

Moreover, the CanWest system would include a lot more programs produced in Western Canada, a goal that gives Asper particular pleasure. He added:

“The central Canadians who have all the political and economic clout in Canada do not have an accurate picture of the West. We hope to change that. People should not have to move to Toronto to express themselves.”

In fact, Asper’s sense of western alienation runs as deep as his Manitoba roots. Currently, Asper and his wife, Ruth (Babs), live in a comfortable bungalow in Winnipeg’s wealthy River Heights section and own a log cabin on Falcon Lake. They have Amini

three children: David, 31, Gail, 29, -

Asper, now a multimillionaire, has come a long way from his birthplace in Minnedosa, a tiny farming town about 200 km northwest of Winnipeg, where his father owned some independent movie theatres. He left Minnedosa in 1945 to study history and law at the University of Manitoba, where he was class valedictorian. Later, he opened a law practice in downtown Winnipeg, eventually earning a reputation as the city’s top tax lawyer. But the ambitious westerner wanted more. He wrote a syndicated taxation column for The Globe and Mail and

chaired provincial government committees on economic development. While hospitalized with hepatitis in 1970, he even found the strength to author a criticism of the federal tax system called The Benson Iceberg, which became a best-seller.

Then, he got involved in politics. Asper has been a staunch Liberal since studying the writings of British philosopher John Stuart Mill at university. In 1970, with a campaign platform of increased economic power for Western Canada, he captured the vacant leadership of the Manitoba Liberal party. But, in the 1973 provincial election, won by New Democratic Party Premier Edward Schreyer, Asper’s party only managed to win five seats. Two years later, weary of being one of the few Liberals in the provincial legislature, he resigned. Recalled Asper: “It takes a long time to effect changes in politics. I wanted things to move much quicker.”

Business provided the vehicle for that. Even before stepping down as Liberal leader, Asper had concluded that his future lay in communications. An opportunity arose in 1974 when he and fellow Winnipegger Paul Morton helped

rescue Global TV, then a small southern Ontario television station, from bankruptcy with an emergency loan of $14 million. Their partner in the bailout was IWC Communications, owned by Toronto broadcasting executive Allan Slaight.

Three years later, Asper, along with Gerald Schwartz, a Harvard-educated Winnipegger who had worked on Wall Street before returning to his home town, formed CanWest Capital Corp., a merchant bank that invested in a wide range of companies. CanWest, which eventually grew to $2.5 billion in assets, made Asper

and Schwartz the toast of the Prairie business community with its successful investments in Monarch Life Insurance Co. and Crown Trust Co.

But the 1982-1983 recession hit CanWest hard, forcing the partners to sell off most of their assets to buy out the shareholders. Then, in 1984, citing irreconcilable differences, they decided to break up, and Asper bought CanWest’s broadcasting holdings, with Schwartz taking some of the other companies, including the Winnipeg-based McLeod Stedman Inc. chain of retail stores.

Since then, Asper has gone from strength to strength. He fought a long, litigious battle for CKVU TV, a highly successful independent television station in Vancouver, and later started up small independent stations—CFSKTV in Saskatoon and CFRE TV in Regina—to go with his CKND TV in Winnipeg.

But his biggest battle was in Global’s boardroom. Although Asper by this time owned 61 per cent of Global, he was confined under a voting trust agreement to exercising only 50 per cent of the votes at the boardroom table. The other 50 per cent was controlled jointly by Morton, then Global president, and Morton’s close friend, Seymour Epstein, the chairman of Global’s executive committee.

Although the partnership had started amicably, by 1985 the three men were embroiled in a bitter fight over how Global should be run. While Asper wanted to do more integration of the television operations to create a national system, Epstein and Morton wanted to keep the focus on Toronto. Asper felt increasingly alienated from the operations. The dispute ended in the Manitoba Court of Queen’s Bench when Epstein and Morton filed a suit claiming that Asper’s CanWest group of companies had backed out of an agreement to sell them 22 per cent of the Global shares. But Asper countersued and even tried to push Morton out of the presidency by claiming that he had been improperly using Global funds for bar tabs, theatre tickets and airline flights.

Last October, the Manitoba Court of Queen’s Bench ordered the warring parties to resolve the ownership deadlock by auctioning the company to the highest bidder—setting the stage for the dramatic Dec. 14 showdown in the Winnipeg offices of Richardson Greenshields of Canada Ltd. “In retrospect, the whole thing was never necessary,” says Asper. “It was like a marriage breakdown that occurs even though nobody is quite sure why.”

Now that the Global war is over, Asper’s wife and children are trying to persuade him to cut back on his exhausting work pace by playing tennis, listening to his beloved jazz and indulging his interest in exotic travel. Asper, who suffered a heart attack six years ago, says he knows that he needs to slow down. “I lack balance in my life,” he says, matter-of-factly. But with his longtime dream of building a national television system just over the horizon, he is running faster than ever.

JOHN DeMONT with correspondents’ reports