Sponsorship deals dictate future

Source: Winnipeg Free Press

As the Canwest Global Communications empire continues to crumble, questions are being raised about the local legacy the company set up during the good times. The Winnipeg-based media company's name and logo adorn a quartet of prominent buildings in Winnipeg: Canwest Place, the Portage and Main office tower; Canwest Park, home to the Northern League's Winnipeg Goldeyes; the Canwest Global Performing Arts Centre, which houses the Manitoba Theatre for Young People at The Forks; and the Canwest Centre for Theatre and Film at the University of Winnipeg.

The sponsorship deals range from a few years to in perpetuity and are worth many millions of dollars to the recipients.

John Douglas, Canwest's vice-president of public affairs, said most sponsorship deals have an expiry date and when the time comes for renewal, both parties will have to decide if they received sufficient value from the relationship.

"It's a business decision. It's based on return on investment. We're no different than any other business when it comes to that sort of thing," he said.

Douglas said the company, which filed for bankruptcy protection for some of its divisions late last year, is trying to find new owners for its publication arm while it recapitalizes the broadcasting side. It's unknown what the final entity will be called.

"We don't know if the company will still be called Canwest. We won't know until the processes are complete," Douglas said.

Denise Lysak, general manager of MTYP, said Canwest secured the naming rights to its facility in perpetuity more than a decade ago when the company came forward with a gift of $750,000 during a capital campaign. She said neither the theatre's senior staff nor its board have looked at changing any of the arrangements with Canwest since the company's fortunes started to fade several years ago.

"At this point, we believe it would be premature to even start to consider something else," she said.

She and her staff will follow the news and, if the time comes, consult privately with David Asper and his wife Ruth, who spearheaded the fundraising on behalf of Canwest. David Asper and his sister Gail Asper resigned from Canwest Wednesday.

The situation is much the same at the Goldeyes. Jason McRae-King, the team's chief financial officer, said its deal with Canwest contains a confidentiality clause so it can't be discussed publicly.

"It's business as usual. They're still operating and we're still operating," he said.

Niraj Dawar, a professor at the Richard Ivey School of Business at the University of Western Ontario, said there are many examples of buildings and sporting facilities that have been left holding the brand after their sponsoring company fell on hard times or went out of business.

He said some entities may no longer want to be associated with a failed company. "You have this big negative event occurring for the one brand and the other brand suffers, too."

© Winnipeg Free Press