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2003 Annual ReportRogers Communications Inc. 83
Notes to Consolidated Financial Statements
with Cogeco. This transaction and number of shares exchanged was based on the closing market value of Cogeco shares
on the date of the transaction of $11.727 per share (note 11(a)(iii)(a)) and had the effect of increasing the Company’s
investment in Cogeco by $35.3 million, including costs of the transaction. The Company’s total investment in Cogeco rep-
resents an approximate 18.19% equity ownership.
(c) Gain on disposition of AT&T Canada Deposit Receipts:
The deposit receipt holders of AT&T Canada Inc. (“AT&T Canada”), including the Company, had a contractual right to real-
ize a minimum deposit receipt price of $37.50 per deposit receipt, increasing at 16% per annum from June 30, 2000 (the
“accreted floor price”) until June 30, 2003, or such earlier time as a minority shareholder of AT&T Canada exercised its
obligation to acquire all of the shares and Deposit Receipts of AT&T Canada. On June 25, 2002, AT&T Corp. announced its
intention to purchase, for cash, the Deposit Receipts of AT&T Canada. This transaction was completed on October 8, 2002 and
the Company recognized a pre-tax gain of approximately $904.3 million. The Company received cash proceeds of approxi-
mately $1,280.4 million and these proceeds were used to redeem the Preferred Securities and settle the Collateralized Equity
Securities, as described below.
The issuance of the Preferred Securities and Collateralized Equity Securities in previous years resulted in the mon-
etization of a substantial portion of the Company’s investment in AT&T Canada, with the Company receiving cash of
approximately $1,186.0 million. The redemption amount with respect to these securities, being $1,317.0 million, was paid
on October 8, 2002, being the same day that the Company received the proceeds from the Deposit Receipts.
The Company, in accordance with the terms of the agreements of these securities, had the right to provide notifi-
cation by specified dates if its intent was to satisfy the redemption of these securities by way of shares. As the Company
determined that it would repay these securities in cash, no notification was provided and the accretion on the value of
these securities after the notice date, being $5.2 million, was expensed in the consolidated statement of income. Amounts
related to the accretion prior to the notice date and the costs incurred by the Company of originally issuing these securi-
ties are recorded in the consolidated statements of deficit (note 11(c)).
(d) Gains (losses) on sales of other investments:
In 2003 and 2002, the Company sold certain investments resulting in the following gains (losses) being recorded:
2003 2002
Publicly traded companies $ 17,902 $ 2,062
Investment accounted for by the equity method – (2,627)
$ 17,902 $ (565)
(e) Write-down of investments:
During 2002, the Company recorded the following write-down of investments:
2002
Cogeco Cable Inc. and Cogeco Inc. $ 238,921
Other investments in public and private companies 62,063
$ 300,984
In 2000, the Company acquired 4,253,800 Subordinate Voting Common shares of Cogeco for $187.2 million and 2,724,800
Subordinate Voting Common shares of Cogeco Inc. for $120.8 million.
During 2002, the Company determined that the decline in the market value of shares held in Cogeco and Cogeco
Inc. represented an impairment that was other than temporary and the shares were written down to their closing quoted
market value at December 31, 2002.
7. DEFERRED CHARGES:
2003 2002
Financing costs $ 64,741 $ 77,915
Pre-operating costs 8,854 20,004
CRTC commitments 56,992 69,238
Other 11,893 17,683
$ 142,480 $ 184,840
Amortization of deferred charges for 2003 amounted to $42.4 million (2002 – $47.2 million). Accumulated amortization as
at December 31, 2003 amounted to $138.3 million (2002 – $105.7 million).