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86 Rogers Communications Inc. 2004 Annual Report
7. INVESTMENTS:
2004 2003
Quoted Quoted
Number Description market value Book value market value Book value
Investments accounted for
by the equity method:
Blue Jays Holdco $ – $ 95,720
Other 9,348 5,055
9,348 100,775
Investments accounted for
by the cost method,
net of write-downs
Publicly traded companies:
Cogeco Cable Inc. 6,595,675 Subordinate
(2003 – Voting
7,253,800) Common $ 169,179 68,884 $ 121,501 75,758
Cogeco Inc. 3,399,800 Subordinate
(2003 – Voting
2,724,800) Common 76,190 44,438 43,488 28,610
Other publicly traded companies 23,772 3,551 25,482 7,508
269,141 116,873 190,471 111,876
Private companies 12,949 16,570
$ 139,170 $ 229,221
(a) Toronto Blue Jays Baseball Club:
On January 5, 2004, the Company paid the remaining amount related to the purchase of the 20% minority interest in the Blue Jays of
approximately $39.1 million. This payment had no impact on the carrying value or the control of the investment since this liability was
recorded at the original date of acquisition.
Effective April 1, 2001, Rogers Telecommunications Ltd. (“RTL”), a company controlled by the controlling shareholder of the
Company, acquired the Class A Preferred shares of a subsidiary of RCI that owns the Blue Jays (“Blue Jays Holdco”) for $30.0 million.
On July 31, 2004, Blue Jays Holdco redeemed and cancelled the 30,000 Class A Preferred shares for $30.0 million, resulting in the control
of Blue Jays Holdco being transferred to the Company. Accordingly, commencing July 31, 2004, the Company began to consolidate its
investment in Blue Jays Holdco. This had no impact on net income since the Company had previously recorded 100% of the losses of
Blue Jays Holdco.
While they were outstanding, the Class A Preferred shares of Blue Jays Holdco had a cumulative dividend rate of 9.167% per
annum. These dividends were satisfied in kind by transferring income tax losses to RTL. During 2004, Blue Jays Holdco transferred
income tax losses to RTL in the amount of $27.4 million (2003 – $24.0 million) with an agreed value of $2.7 million (2003 – $2.4 million).
From January 1, 2004 to July 30, 2004, cash contributions of $30.1 million (year ended December 31, 2003 – $29.4 million) were
made to Blue Jays Holdco.
As a result of the consolidation of the Blue Jays, the net assets included on consolidation effective July 31, 2004 are as follows:
As at July 31, 2004
Assets
Accounts receivable $ 32,169
Cash and cash equivalents 70
Other current assets 3,334
Property, plant and equipment 7,166
Goodwill 95,509
Player contracts 27,524
Other long-term assets 36,913
202,685
Liabilities
Accounts payable and accrued liabilities 27,822
Unearned revenue 10,869
Other long-term liabilities 31,151
69,842
Net reduction in investment $ 132,843