Montreal-based animator Cinar Corp. faced growing scrutiny over millions of dollars in missing investments. Cinar has been reeling under allegations that $179 million was transferred out of the company without the approval of the company’s board. About $112 million has not been recovered. After the March 6 announcement, Cinar said that Ron Weinberg, who co-founded Cinar with his wife, Micheline Charest, in 1976, was not involved in the transfer. Nevertheless, he and Charest resigned their executive duties, although they still own 60 per cent of the publicly traded company. Hasanain Panju, a senior executive vice-president who executed the transfer, was fired. But last week, Cinar’s new managers said that Weinberg may have been involved in the transfer.
The company has launched a law-
suit against a trio of investment companies, including two based in the Bahamas, in an effort to reclaim the missing funds. Meanwhile, federal authorities continue to investigate Cinar, which produces popular children’s shows like Arthur and The Adventures of Paddington Bear, for tax fraud: the company has been accused of putting the names of Canadian writers on scripts written by Americans in order to claim tax credits.
CTV gets the go-ahead to buy TSN
The CRTC ruled that CTV, Canadas largest private TV network, can buy NetStar Communications Inc. and its all-sports channel, TSN, as long as CTV sells Sportsnet, its own sports broadcaster. CTV said it would not comment on the ruling until it had studied the terms with its partners. BCE Inc., which proposes to buy CTV to expand its Internet content, made the $409-million NetStar acquisition a condition of the takeover deal. CBC executives praised the ruling, saying Sportsnet with TSN could have given CTV a near-monopoly on sports.
Interest rates continued their upward climb last week. The third hike in four months boosted the Bank of Canada’s rate to 5.5 per cent, up by one
quarter of a percentage point. The widely anticipated increase followed a similar move by the U.S. Federal Reserve Board, which raised its trendsetting rate to six per cent, up from 5.75 per cent. Officials in both countries said fears of inflation prompted the increases, but experts expect that further hikes will be needed before North America’s surging economies are slowed by higher borrowing costs. Economists at the Toronto Dominion Bank believe Canada will try to minimize future hikes in an effort to prolong the country’s relatively recent economic recovery.
Reid cashes out
Vancouver-based pollster and market research guru Angus Reid was smiling last week after he sold his 21-year-old firm to a French company for about $100 million. Ipsos SA of Paris will merge Angus Reid Group Inc. into its operations but retain the Canadian management team. Founder and CEO Reid, who will stay with the company, said that arrangement was crucial to the deal: he declined previous international merger offers, he said, because they did not include sufficient Canadian autonomy. The privately held company, one of the largest independent pollsters in the country, has annual revenues of about $35 million.
Books and bulbs
Behemoth book retailer Indigo Books Music & More Inc. purchased one of Toronto’s premier gardening stores, Cruickshank’s Inc. Indigo, whose owner, Heather Reisman, says she is one of Cruickshank’s best customers, will now market gardening items on its Web site. The move follows a similar acquisition by rival book retailer Chapters Inc., which bought Montreal-based Garden Crazy Ltd. earlier this year.
Soaring trade surplus
Exports rose by four per cent in January, compared with the previous month, reaching $33.2 billion, while imports fell to $28.6 billion. Strong sales of cars, energy exports and machinery to the thriving U.S. market were key reasons, along with seasonal factors.
Wár on flatulence
A Calgary company with extensive investments in coal proposes to spend millions of dollars to reduce the amount of digestive gas produced by African cows, sometimes blamed for contributing to global warming. TransAlta Corp. says that by spraying livestock feed, it can greatly reduce the amount of methane the animals produce. The company wants to take advantage of rules allowing the international “trading” of credits for cutting greenhouse gas emissions, thus allowing more gasproducing coal to be burned in Canada within the target level.
Canadas two largest cable companies announced a major alliance that included a swap of territories and a merger of Internet services. Subject to CRTC approval, Toronto-based Rogers Communications Inc. will transfer its B.C. cable assets to Calgarybased Shaw Communications Inc. Rogers will pick up Shaw’s cable properties in southern Ontario and New Brunswick, effectively carving up the west and east of the country between them. But soon after, Rogers faced a challenge to its plans in Quebec as media conglomerate Quebecor Inc. announced a $5.9-billion hostile takeover bid for Montreal-based Groupe Vidéotron Ltée., the province’s largest cable operator.
Quebecor’s move on Friday came just three days before Vidéotron shareholders were to vote on a $5.6billion share exchange with Rogers, a friendly merger that was announced on Feb. 7. The Quebecor bid is backed by Capital Communications CDPQ Inc., a subsidiary of the giant Caisse de dépôt et placement du Québec, the provinces major pension fund and a Vidéotron minority shareholder. The Caisse daims it has the right to veto the deal with Rogers.
Shaw and Rogers, meanwhile, also agreed to merge @Home Canada and Excite.ca to form a new Internet portal and high-speed access system to be called Excite@Canada. Rogers will retain 51 per cent of the new entity. It will join Shaw in investing in Vancouverbased 360networks Inc., a leader in the construction of long-distance fibreoptic networks.
Nortel shops again
Nortel Networks Corp. said it will buy laser component maker CoreTek Inc. of Wilmington, Mass. The $2-billion, all-stock deal follows two other Nortel acquisitions aimed at strengthening its hold on the market for fibre-optic networks. CoreTek is developing laserchip technology to transmit a range of light frequencies on one line. Other chips transmit only one frequency.
The story you want is part of the Maclean’s Archives. To access it, log in here or sign up for your free 30-day trial.
Experience anything and everything Maclean's has ever published — over 3,500 issues and 150,000 articles, images and advertisements — since 1905. Browse on your own, or explore our curated collections and timely recommendations.WATCH THIS VIDEO for highlights of everything the Maclean's Archives has to offer.