Competition Bureau Challenges Astral Acquisition of Télémédia Radio Stations in the Province of Québec

OTTAWA, December 21, 2001 — The Competition Bureau announced today that it has filed an application with the federal Competition Tribunal to challenge the proposed acquisition by Astral Média Inc. of eight French language radio stations owned and operated by Télémédia in the province of Québec and of the 50% interest held by Télémédia in Radiomédia. The remaining part of the proposed transaction which mainly relates to the acquisition by Astral of radio stations held by Télémédia in the Maritimes does not raise a competition issue.

"We are taking action to maintain competition between two major radio networks in Québec, for the benefit of advertisers and consumers" said Gaston Jorré, Senior Deputy Commissioner of Competition.

After a thorough review, the Competition Bureau has determined that the proposed transaction is likely to prevent or lessen competition substantially in six relevant markets. Through the acquisition of Télémédia, Astral would have a near monopoly in French-language radio stations in 4 markets (Hull/Ottawa, Sherbrooke, Trois-Rivières and Chicoutimi-Jonquière) and substantial control over French-language radio advertising markets in Montréal and Québec City.

"In our view, radio advertising has some unique attributes which distinguish it from other forms of advertising", said Mr. Jorré. "Anyone controlling all or most radio advertising in a given market could significantly raise prices. That is why we strongly believe this proposed merger must be challenged."

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For general public enquiries, please contact:
Competition Bureau's Information Center
1-800-348-5358

For media enquiries, please contact:
Tim Weil
Senior Communications Advisor
Communications Branch
819-953-9271 or 613-296-2189 (cell.)