According to financial terms of the ctv/NetStar deal revealed last week, ctv’s interest in specialty channels Outdoor Life Network and CTV Sportsnet must be transferred to NetStar Communications within 12 months of regulatory approval.

Moving the channels to NetStar will give Walt Disney/abc subsidiary espn a 32% stake of ctv’s ownership in those channels. ctv holds a 40% stake in CTV Sportsnet and 33% in oln.

ctv scooped a 68% interest in NetStar from rival bidder CanWest Global last month after 32% NetStar shareholder espn exercised its right to seek an alternative purchaser.

NetStar’s holdings include 100% of tsn, rds and Dome Productions as well as 80% of Discovery Channel and 25% of Viewers Choice Canada.

‘ctv and espn have agreed to negotiate within 12 months of crtc approval the terms on which ctv would transfer to NetStar its interests in ctv’s sports-related specialty cable television undertakings,’ according to a ctv release.

ctv’s sports-related specialty cable television undertakings include ‘CTV Sportsnet and Outdoor Life Network,’ says Tom Curzon, vp communications, ctv.

Should ctv and espn be unable to reach an agreement on the terms of transferring ctv’s interests in oln and Sportsnet to NetStar, espn would have the right to sell its NetStar interest to ctv. At NetStar’s current debt level, the purchase price would be $198 million.

Terms of the deal also reveal that any new Canadian sports specialty channels in which ctv and/or espn has an interest will be owned by NetStar. New opportunities for Canadian science and nature specialty services will be offered first to NetStar as well. The deal stipulates that any future NetStar transactions will be subject to approval by both ctv and espn.

crtc and Competition Bureau rulings on the deal are not expected before December. If regulatory approval of the deal is not obtained, espn has the right to demand ctv purchase its stake in NetStar for no less than its value on the closing of the deal last week.

If tsn is not rebranded as ESPN Canada within 18 months of crtc approval of the deal, espn will have the right to sell its NetStar interest to ctv for as much as $206 million.