Selling Ten has simplified Canwest shareholders and improved the balance sheet
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Ten cash cow not that much of a cash cow. Yes the shares paid dividends.
[Idea. Company sold shares that did not real contribute to interest payments, so debt lower, and interest costs lower. Yes Canwest recieve funds from Ten, measured effect.]
2009 Canwest financial statement
Quote," DistributionsTen Holdings historically made distributions twice annually. In January 2009, Ten Holdings distributed $15 million, $9 millionto us and $6 million to other shareholders. Ten Holdings did not make any further distributions in fiscal 2009. We sold our interest in Ten Holdings in October 2009."
Asset sold that produce less income than interest expenses.
p35 Canwest 2006 Annual Report
Quote, "The Company has determined that it is the primary benefi ciary of TEN Group. The Company owns approximately 14.4% of the issued ordinary shares and all of the convertible and subordinated debentures of TEN Group. The subordinateddebentures in the amount of A$45.5 million pay interest calculated based on distributions to holders of the ordinary shares. The convertible debenture in the amount of A$45.5 thousand pays a market
linked rate of interest and is convertible into ordinary shares representing 49% of the issued and outstanding shares of TEN Group upon paymentof A$45.5 million. The combination of ordinary shares and subordinated debentures yield distributions equivalent to 56.4% of all distributions paid by TEN Group. In addition, as disclosed in note 2(b), the Company has determined that it is the primary benefi ciary of the Turkish radio stations. Accordingly, as required by the Canadian Institute of Chartered Accountants Accounting Standards Board, Accounting Guideline 15 (“AcG-15”), Consolidation of Variable Interest Entities, the Company has consolidated the variable interest entities. Because the Company does not have voting control relative to these variable interest entities, it does not have free access to their assets.
p19 Canwest 2008 Annual Report
Distributions
Our Australian operations make distributions twice annually. In July 2008, the Ten Groupdistributed $32 million, $18 millionto us and $14 million to other shareholders and in January 2008 Ten Holdings paid a dividendof $82 million which resultedin $46 million to us and $36 million to other shareholders.
[Disposition increased dividend, normally much smaller. ]
The Limited Partnership makes monthly distributions. During the year ended August 31, 2008, we received $166 million from the Limited Partnership. The distributions from our Australian operations are affected by the profitability of these operations. A change in the profitability will impact the amount of distributionsreceived from the Australian operations. The distributions from the Limited Partnership arerestricted by the availabilityof distributable cash as defined under its debt agreements. A change in distributable cash would impact the amountof distributions received from the Limited Partnership.
[But funds in ten not canwest,. Similair to Canada's media, huge returns for little service.]
Australia–Network TEN Revenue 05 783,315 04 721,247 operating profit 05 293,528 04 256,033
Income taxes. Our income tax expense was $20 million for fiscal 2005, compared to $37 million for fiscal 2004. The effective tax rate of 15% was below the Company’s statutory rate of 35% as a result of the impact of international tax rates which were lower than Canadian tax rates, as well as the impact of (i) a $10 million recovery related to the resolution of an uncertain tax position, (ii) a $7 million effect of recognizing temporary differences which were not previously tax effected, and (iii) a change in Australian tax legislation that allowed TEN Group to record a future taxes recovery of $18 million.
