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All set for big media takeover

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TORONTO -- Canada's competition watchdog will not challenge Bell Canada (TSX:BCE) and Rogers Communications Inc. (TSX:RCI.B) on their $1.07-billion takeover of Maple Leaf Sports and Entertainment, despite concerns about concentration in the industry, the regulator said Wednesday.

The Competition Bureau said it has issued a "no-action" letter to the telecom giants indicating it doesn't plan to have the deal reviewed under the Competition Act.

However, it added it has heard several serious concerns about the potential effects of the deal that would see Canada's largest telecom companies have control over content.

Critics of the deal, which is expected to close this summer, have raised questions about the effect of putting so much content in the hands of some of Canada's largest companies, fearing consumers will ultimately pay more.

The commissioner of competition is actively reviewing those concerns and won't hesitate to take action if she determines the Competition Act has been violated, the bureau noted.

The legislation provides the bureau with a one-year period following the deal's closure to bring a challenge to the Competition Tribunal.

The two companies, fierce rivals in the delivery of cellphone and Internet services, teamed up on the billion-dollar bid for a majority stake in the country's biggest sports franchise company -- owner of the NHL's Maple Leafs, the NBA's Raptors and the Toronto FC soccer club in December.

"The bureau's announcement means we are one step further in the process of closing the deal," Rogers spokeswoman Patricia Trott.

The deal is also subject to approval from the Canadian Radio-television and Telecommunications Commission and various sports leagues.

Rogers and Bell want to put sports content on everything from smartphones to tablets and televisions to personal computers so fans don't miss any games. The move also gives them more access to advertising revenue.

But both companies have stressed they will compete on how they distribute the content.

"The acquisition secures on a long-term basis access to TV, mobile, digital online and radio broadcast rights for both Bell and Rogers to MLSE's sports teams," Bell said in a statement.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition May 3, 2012 B5

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