Business NOTES

January 22 1996

Business NOTES

January 22 1996

Business NOTES

The channel scramble

As the Canadian Radio-television and Telecommunications Commission deadline for submissions loomed, would-be broadcast barons raced to put the finishing touches on proposals for new speciality television channels.

In all, the CRTC appeared likely to receive more than 30 proposals, ranging from a science fiction channel to an all-comedy network. The competition is so heated that one group, whose ambition is to launch a natural history channel, delivered its application with a live panther in tow.

Just about every type of television programming imaginable will be before the CRTC, which has not decided how many new licences it will issue.

The Canadian Broadcasting Corp. and Southam Inc. are proposing a Headline News Channel, while Horseco, a consortium of Ontario’s horse-racing industry, wants to broadcast races on The Horse

Network. The Asian Television Network would be a multilingual service aimed at Canadians of South Asian origin. And CHUM Ltd. vice-president Moses Znaimer said his company is seeking nine new licences, including an adult music channel.

The winners will not begin broadcasting until late 1997. But unlike in the past, when some specialty channels were partly subsidized by cable revenues, the CRTC has made it clear that the new services will have to make it on their own. By the time the new programming is available, new cable technology should allow cable subscribers to pick and choose among the new channels they wish to watch and pay for. “There is not going to be negative optioning or dumping of new services onto existing packages and raising the prices even by a little bit,” said Harris Boyd, vice-president of the Canadian Cable Television Association.

Top funds

North American stock exchanges had one of their best years in history in 1995, with the result that many investors who bought mutual funds did extremely well. The hottest mutual funds in Canada delivered returns as high as 66 per cent—far surpassing 1994 levels that topped out at 31 per cent. Among the winners:

• Admax Regent International Management’s $41.4-million Global Health Sciences Fund took top spot with a 1995 return of 66.3 per cent. Managed by Barry Kurokawa of Denver-based Invesco Trust Co., the fund quadrupled from $10 million at the start of the year.

• Royal Bank’s Royal Precious Metals Fund surged 63.8 per cent for the year’s secondbest performance. Manager John Embry made good calls on mid-sized and junior gold stocks, cutting back on the fund’s holding of bullion and big gold producers. He also bought Bre-X Minerals Ltd., which made a major Indonesian gold discovery, at about $2 each. The shares closed last week at $68 on the Alberta Stock Exchange.

• Global Strategy’s $20.8-million World Emerging Companies Fund soared by 52.8 per cent. The year-old fund, which invests in small companies in developed markets and big companies in emerging markets, is run by three overseas managers.

• Toronto-Dominion Bank’s $lll-million Green Line Science and Technology Fund, which is weighted towards U.S. technology stocks, was No. 4 with a 51.1-per-cent return. In 1994, the fund earned a 28.3-per-cent jump.


Flamboyant Calgary businessman Larry Ryckman said that a hearing into his stocktrading practices is a “witch-hunt.” Ryckman, who owns the Calgary Stampeders football team, controlled 34 trading accounts in Westgroup Corporations Inc. A lawyer representing the Alberta Securities Commission said Ryckman was chairman of Westgroup in 1992, when he allegedly engaged in 88 “wash trades,” buying and selling shares to create a false market. Ryckman refused to attend the Calgary hearing. If found guilty, he could be banned for life from trading on the Alberta Stock Exchange.


A Quebec court has ruled that CFCF Inc. does not have to hold a special shareholders’ meeting to ratify a decision to swap its cable assets for a stake in Montreal broadcaster Télé-Métropole Inc. The $720-million deal will make Montrealbased CFCF the largest private broadcaster in Quebec. The deal had been opposed by Cogeco Cable Inc. of Montreal, which was attempting to take over CFCF.


The Export Development Corp. plans to investigate allegations that Boeing Co. and BahamasAir duped the Crownowned agency in a bribery scheme involving the sale of five de Havilland aircraft in 1989. The allegations are part of a $1.2-billion suit launched by St. John’s, Nfld., businessman Craig Dobbin in Miami. The documents claim Boeing bribed BahamasAir officials, and convinced the EDC to withhold a promised loan to Dobbin’s firm, Aviaco International Leasing Inc. Aviaco had hoped to purchase the planes and lease them to BahamasAir. Boeing denies the allegations.


Apple Computer Inc. of Cupertino, Calif., is continuing to surrender market share and expects to lose $90 million in the first quarter of 1996—raising speculation that the firm may soon be taken over by a rival. Analysts say that Apple’s costs are too high. The pioneering computer company has announced that it may cut as many as 4,000 of its 16,000 workers in 1996.


Alberta Energy Co. of Calgary acquired 94 per cent of Toronto-based Conwest Exploration Co. shares in a pact valued at $912 million, making it one of the largest oil-and-natural gas companies in Canada. Alberta Energy president Gwyn Morgan said the company will spend nearly $400 million over the next three years on a major exploration program in which the company will drill more than 300 wells.


Barney’s Inc., an upscale New York Citybased fashion and speciality store chain, filed for bankruptcy protection after it was unable to pay for an ambitious expansion program it undertook last year. The firm, which began as a no-frills men’s store 73 years ago, mushroomed into a 14-store chan that catered to well-heeled patrons who were able to afford the chain’s lofty prices. But Barney’s ran into trouble when it was unable to repay Isetan Co., the Japanese retail chain that financed the expansion.