Cogeco Media to acquire 10 of RNC Media’s 15 radio stations

RNC Media is vastly decreasing its role as a major radio broadcaster, and has agreed to sell 10 of its 15 radio stations to competitor Cogeco for $18.5 million.

Affected stations are:

  • Planète 104.5 in Alma
  • Planète 93.5 in Chibougamau
  • Planète 99.5 in Roberval
  • Planète 100.3 in Dolbeau-Mistassini
  • Radio X 95.7 in Saguenay (repeater at 96.3 Alma)
  • Capitale Rock 104.3 in Val-d’Or
  • Capitale Rock 102.1 in La Sarre (repeater at 95.7 Rouyn-Noranda)
  • WOW 96.5 in Rouyn-Noranda (repeaters at 103.5 Val d’Or and 103.9 La Sarre)
  • Pop 104.9 in Lachute
  • Pop 102.1 in Hawkesbury

The sale leaves RNC Media with five stations in its three largest markets:

  • CKLX-FM (91,9 Sports) in Montreal
  • CHOI-FM (Radio X) in Quebec City
  • CHXX-FM (Pop 100.9) in Donnacona (serving Quebec City, repeater at 105.5 Lotbinière)
  • CFTX-FM (Pop 96.5) In Gatineau (repeater at 107.5 Buckingham)
  • CHLX-FM (Wow 97.1) in Gatineau

Cogeco already has two French-language FM stations in Montreal and Quebec City, which means there was no point in Cogeco acquiring them. It has one station (CKOF-FM 104,7) in Gatineau. The acquired stations will be its first in the Saguenay and Abitibi regions.

RNC Media also owns TVA and V affiliates in Gatineau and Abitibi-Témiscamingue. It recently announced it was shutting down its Radio-Canada affiliate in Abitibi, CKRN. RNC said the Montreal, Quebec and Gatineau stations were “not on the market.”

The sale requires approval by the CRTC before it can proceed.

We should also expect some of these stations to join Cogeco’s network brands, particularly Rythme FM.

A map of Quebec’s major commercial radio networks: Cogeco Media (purple), RNC Media (red, with pending sales in reddish purple), Bell Media (blue), Attraction Radio (black) and Groupe Radio Simard (gold).

If the acquisition goes through, Cogeco’s radio network will cover the vast majority of the province’s population. Of population centres over 15,000, the only ones that wouldn’t be within 100 kilometres of a transmitter would be Rimouski and Sept-Îles.

UPDATE (June 28): The application for the purchase has been posted by the CRTC, with a (non-appearing) hearing set for Sept. 6. Among the details in the application:

  • Cogeco plans no immediate change to the “vocation” of the radio stations, which will remain local.
  • Cogeco plans to introduce local newscasts to the Lachute station. For other stations, the benefits come mainly through access to the infrastructure of Cogeco Nouvelles.
  • Proposed tangible benefits are $1,184,217, based on a total transaction value of $19,736,958. The breakdown uses the standard formula for radio, with:
    • $592,109 (3%) to Fonds Radiostar
    • $296,054 (1.5%) to Musicaction
    • $98,685 (0.5%) to the Community Radio Fund of Canada
    • $197,370 (1%) to discretionary initiatives
  • The nature of the discretionary initiatives isn’t specified, but Cogeco said it would include six-week paid internships at its radio stations. The commission pushed back on this (tangible benefits are not allowed to be self-serving), and Cogeco responded by saying it would use $10,000 a year for bursaries instead. The rest of the discretionary money would go to local initiatives, broken down as follows:
    • $10,000 a year in the Saguenay region
    • $5,000 a year in the Abitibi region
    • $3,196 a year in the Lachute-Hawkesbury region
  • The contract includes a 36-month service contract for RNC Media to continue providing local news, office space, outdoor advertising, transmitters and technical support for the stations in the Abitibi region after the deal closes. Following that, Cogeco will rent space for three transmitters at two sites from RNC for $5,000 a year each for 10 years (indexed to the consumer price index), and two transmitters at a third site for five-year renewable leases for a price to be negotiated.
  • The radio stations (bought by Cogeco) and TV stations (retained by RNC Media) in the Abitibi region will continue to cross-promote for a period of 24 months after the acquisition. The exact value of these ads is confidential, but will be the same for both sides. A similar ad exchange deal is in place for Cogeco’s CKOF-FM (104,7) and RNC Media’s TV stations in Gatineau, even though those stations aren’t part of this transaction.
  • Cogeco acquires the WOW brand (used by CHOA-FM in Val-d’Or) and gives RNC Media a licence to continue to use the brand for its Gatineau station. Cogeco also acquires the Planète and Capitale Rock trademarks.
  • RNC Media holds on to the POP brand (used by CFTX-FM in Gatineau and CHXX-FM in Donnacona) but gives Cogeco licence to use it for the Rouyn-Noranda station.
  • RNC also keeps the Radio X brand, which is used by CKYK-FM in Saguenay. Cogeco can use the KYK logo, but without any mention of Radio X. There does not appear to be transition allowance here, which means it would have to change the branding as soon as the deal closes.
  • Cogeco says of the 220 on-air employees it will have if the transaction is approved, 92 (42%) are women, 4 (2%) people with disabilities, 2 (1%) visible minorities and 1 (0.5%) Indigenous person. (In the application, Cogeco gets the math wrong by two decimal places on the last three percentages there, making it look even worse.)
  • About 55 employees will move with the stations — 10 in Abitibi, 44 in Saguenay and one in Lachute. Three of those employees are currently on leave.
  • The deal will close on the first of the month after CRTC approval. This is listed as the only remaining condition for closing.
  • The deal includes a non-compete agreement for Val d’Or, La Sarre, Rouyn-Noranda, Lachute, Hawkesbury, Amos, Dolbeau, Roberval, Alma, Chibougamau and Saguenay, for a confidential period.

UPDATE (Aug. 28): RNC is also selling CHOI Radio X and 91,9 Sports, to Leclerc Communication.

7 thoughts on “Cogeco Media to acquire 10 of RNC Media’s 15 radio stations

  1. dilbert

    Without a doubt, the stations will face a rebranding. The Planete stations are good candidates to go to Rythme FM format. It would be a solid move that would move that format into a near province wide thing. Less obvious is what to do with the Pop, Capitale Rock and Radio X branded stations, as Cogeco doesn’t seem to have a ready in house brand for them.

    What I think you will see happen here is consolidation and centralization. Each station is likely to lose some of their local hosts as they move to Rythme “network” programming for at least part of the day (likely mid-day and possibly evenings and overnights). You can also expect the news, sports, and weather to come from a more centralized resource.

    Radio (like print) is a declining market for advertising. Since on air staff and studio space is often some of the biggest overhead items, you can see where shrinking it down may be the best choice. I wouldn’t be surprised to see Cogeco even try to move maybe the Pop branded stations to a more automated, no-DJ style style similar to the automated Bob-FM stations. It’s generic enough, and would cut costs dramatically – have a local morning show, maybe a local drive home show, and the rest is automated to the network. Cost savings and bottom line efficiency!

    The real question will be “who will buy the rest of RNC?”. This is their second move to essentially sell themselves out of business, The 5 radio stations are major Quebec markets, perhaps a player like Evanov might want to step up and trade around some properties to get higher power FM in those areas.

    Consolidation. It’s a never ending process until you have only a few players left.

    1. Brett

      I don’t see Evanov doing a trade as their only French station in Quebec isn’t so popular. Don’t hear people mention AM 980. Besides of RNC is looking to get out of the radio business why trade a higer rated staion for something lower rated?

      1. dilbert

        I don’t think RNC wants to end up with anything. Evanov would be right up against their limits if they bought these (at least in Montreal).

  2. dilbert

    Well, with the update (June 28th) I will say this:

    RNC still seems to want to keep a toe in radio, but they have certainly sold and licensed way more than I thought. Clearly the Radio X branding is the only thing they truly hold as important, Pop is second but they are licensing that for now (likely just to give Cogeco less work to do right at changeover time). Pretty much everything else goes with the sale, I am a little surprised that they let the brands go so easily, but then again, it makes it easier for Cogeco to transition over time instead of having to do a whole bunch of stations at the same time.

    The transmitter rentals and cross sale ads deals are about the same as well – don’t rock the boat on day one. Cogeco will have only one station to rebrand (KYK), but even that appears to have been negotiated into a sort of soft transition by retaining most of the logo and probably the programming type as well.

    The question will be integration. With Cogeco work towards rebranding to their own brands, trying to get a network for each of their major formats, or will they operate them independently as stand alone operations?

    1. Fagstein Post author

      I am a little surprised that they let the brands go so easily

      Besides WOW, the brands aren’t being used by any other stations. Why would RNC complicate matters by insisting on keeping them? And it’s not exactly like WOW is such a fantastic, unique and historic brand.


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