Ron Meyer was appointed president and chief operating officer of MCA Inc., the entertainment conglomerate recently acquired by Seagram Co. Ltd. for $7.7 billion. Meyer, 50, will replace Sidney Sheinberg, 60, who has run MCA since 1973, on Aug. 1. Meyer is president and co-founder of Creative Artists Agency and a partner of Michael Ovitz, Seagram’s first choice for the MCA job.
CANWEST GOES EAST
CanWest Global Communications Corp. of Winnipeg established its first toehold in Quebec, forming a joint venture with TéléMetropole of Montreal. The companies plan to revitalize CKMI-TV, currently an Englishlanguage affiliate of the CBC in Quebec City for which Télé-Metropole holds the licence. The move brings CanWest closer to its objective of becoming Canada’s third national television network.
First Chicago Corp. and NBD Bancorp Inc. of Detroit have concluded the secondbiggest bank merger in U.S. history. As a result of the $7.3-billion deal, the two companies have created First Chicago NOB Corp., the seventh-largest U.S. bank, with assets of $163.1 billion. It is the latest in a string of megamergers in the U.S. financial services sector.
CUTBACKS AT THE BANK
The Bank of Canada has announced plans to reduce staff and restructure its operations to reduce its operating budget by 12 per cent over the next five years. The bank will cut up to 600 of its 2,050 employees and close five bank-note distribution centres.
Algoma Steel Inc. of Sault Ste. Marie, Ont., has completed its plans to raise $525 million through a new issue of common shares and sales of first mortgage notes. The proceeds of the issue will be used to finance a modernization program, including investment in a $400-million thin-slab steel caster. Algoma employees own 60 per cent of the company.
The median Canadian salary rose slightly in 1993 to $20,000 from $19,900 in 1992, according to Statistics Canada. Between 1989 and 1993, the median income rose 7.5 per cent. A typical woman earned 61.9 per cent of an average male income in 1993, up from 61.7 per cent in the previous year. Total self-employment income rose 6.7 per cent between 1992 and 1993.
Dispute over WIC flares again
The battle for control of WIC Western International Communications Ltd. of Vancouver intensified last week, resulting in the resignation of Frank Griffiths and Harold Roozen as co-chairmen and members of the executive committee. Edmund King, deputy chairman of Wood Gundy Inc. and a WIC director, has been named as their replacement. The company, which owns eight television and 11 radio stations as well as pay-television and satellite network assets, stated that because of “ongoing legal actions between major shareholders,
Mr Griffiths and Mr. Roozen felt it to be in the best interests of WIC if the chair was held independently of the parties most directly involved in the litigation.” Both men will remain on WIC’s board of directors.
Griffiths, the son of WIC founder Frank Sr., and Roozen represent opposite sides in a battle for control of the broadcasting conglomerate. They have shared the chairman-
ship of WIC since September, 1994. Griffiths and his family control 62 per cent of the voting shares and five per cent of the non-voting shares of WIC through the family company, Western Broadcasting Co. Ltd. Roozen represents Cathton Holdings Ltd., which is owned by the Allard family of Edmonton. Cathton holds 29 per cent of WIC’s voting shares and 10 per cent of the nonvoting stock. Last year, the Allards’ bid to gain is control of WIC was foiled by § the Griffithses, although 6 the Allards were eventually I allowed to acquire some I voting shares and to share I the chairman’s role.
$ Despite that compromise, 5 the two families are still feuding over the Allards’
claim that, under a company bylaw—known as a coattail provision—they are technically the largest single shareholders in WIC. The coattail converts nonvoting shares into voting stock in the event that there is a change of control in the ownership of WIC.
Seaway bid group
A consortium of some of Canada’s largest corporations is proposing to take over the operation and management of the St. Lawrence Seaway in Ontario and Quebec from Transport Canada. The members of the group, who include the largest users of the water route, say that they are determined to protect their business interests by playing a key role in the seaway’s future. In a “directional statement” last month, Transport Minister Doug Young signalled his intention to commercialize the seaway. Federal policies covering the marine sector, as well as the railway and aviation industries, are currently under review. Ottawa’s plans for the seaway are expected to be announced in the fall.
The seaway consortium includes vessel operators Algoma Central Corp., Upper Lakes Shipping Ltd., Canada Steamship Lines Inc. and Fednav Ltd. (Canada Steamship Lines Inc. of Montreal is 100-per-cent owned by federal Finance Minister Paul Martin. While Martin is a member of cabinet, however, he has com-
pletely relinquished control of his business assets to a blind trust.) They have teamed up with steelmakers Stelco Inc. and Dofasco Inc., as well as three grain handlers—Cargill Ltd., James Richardson and Sons Ltd., and Louis Dreyfuss Corp.
Although no concrete proposals have been put forward yet, the consortium would prefer the seaway to be placed under the control of a joint publicand private-sector venture, with private enterprise taking responsibility for the daily operation of the waterway. In a separate initiative, engineering company SNCLavalin Group Inc. of Montreal has also expressed an interest in running the seaway. Ownership of the system, which includes 13 locks and four canals between Montreal and Lake Erie, would probably remain in federal government hands.
The consortium says its goal is to ensure that Ottawa’s plans for the seaway do not impair its members’ “commercial flexibility.” The group’s list of concerns includes labor contracts, legislation and an emphasis on working more closely with the U.S. government, which contributes to the seaway’s maintenance.
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