Canada’s Rogers Communications has put The Shopping Channel up for sale and received interest from foreign buyers for the television asset that may fetch over $300 million, according to three people familiar with the matter.
The move fits into a refreshed strategy at Rogers, which hired a chief executive with a reputation as a turnaround artist in late 2013, as it tries to shake up its corporate culture and stem declines in its wireless and cable divisions, the company’s biggest sources of revenue.
Rogers, which started the process about six weeks ago, has received the first round of bids and is currently lining up second round bids, the sources said.
Liberty Interactive is one of the bidders, said one of the sources. Other interested parties could include U.S. home shopping channel operators HSN and EVINE Live, which runs ShopHQ, as well as private equity firms.
Rogers could still decide not to go ahead with the sale if the economics were not favorable, the sources said.
While several foreign players have shown interest, Canadian regulations could block a sale of a controlling interest in the asset to a foreign entity, said multiple sources familiar with the matter.
One source familiar with the asset said a foreign buyer could acquire a majority equity stake in the asset, so long as a Canadian entity is deemed to have majority voting control in the asset, and as long as the operating entity in Canada is headed by a Canadian.
“There is also huge uncertainty moving forward due to the change of the distribution framework in Canada” said the source, pointing to the new pick and pay regulations.
Canada’s broadcast regulator ruled in March that Canadian television viewers will no longer be forced to pay for a vast numbers of channels they do not watch.
The Shopping Channel is a part of Rogers’ broader media business. The Rogers media division – which includes specialty sports and other TV channels, magazines and radio stations – contributed just under 15 percent to total revenue in the first quarter.
As consumer habits change and people shop online more, Rogers is seeing less value in this asset, one of the sources said.
A Rogers spokeswoman declined to comment. Liberty, HSN and EVINE were not immediately reachable for comment.
By John Tilak, Liana B. Baker and Alastair Sharp
(Editing by Euan Rocha, Grant McCool and Bernard Orr)
Photo courtesy of Reuters/Mark Blinch