Tag: Rogers-Shaw deal

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Competition Tribunal decides Rogers-Shaw merger can move ahead

Canada’s Competition Tribunal cleared the way for the Rogers-Shaw merger to move ahead after dismissing the Competition Bureau’s application to block the proposed $26 billion acquisition.

The deal still requires approval from Innovation, Science and Economic Development Canada (ISED) and a spokesperson for Minister François-Philippe Champagne told The Globe and Mail that ISED was reviewing the tribunal’s decision and “will have more to say in due course.”

The Competition Tribunal released a summary of its decision on December 29th and plans to release a more detailed decision in the next two days. The summary notes that the tribunal found the merger would not result in materially higher prices.

Moreover, the decision said the sale of Shaw’s Freedom Mobile to Quebecor-owned Vidéotron — a key pillar of the deal — would likely not prevent or lessen competition substantially. Earlier this year, Quebecor agreed to buy Freedom for $2.85 billion.

The tribunal also dismissed concerns that Bell and Telus would not be able to compete with the combined Rogers and Shaw.

“I am very disappointed that the tribunal is dismissing our application to block the merger between Rogers and Shaw. We are carefully considering our next steps,” said Matthew Boswell, commissioner of the federal Competition Bureau, in a statement on the 29th. The Competition Bureau has 30 days to appeal the tribunal’s decision.

Additionally, The Globe and Mail reported that Rogers and Shaw agreed to extend the deadline of the proposed merger into 2023. The extension requires Rogers to pay its bondholders $250 million.

Source: The Globe and Mail, CBC News

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Mobile Syrup

Mediation between Rogers, Shaw and Competition Bureau fails

Efforts to mediate the Commissioner of Competition’s concerns on Rogers’ takeover of Shaw have failed.

The mediation took place behind closed doors on July 4th and 5th. The commissioner will present his application to the Competition Tribunal later this year.

The commissioner filed to block the merger in May, stating it would decrease competition in the wireless market and increase costs for Canadians.

“We are taking action to block this merger to preserve competition and choice for an essential service that Canadians expect to be affordable and high quality,” Matthew Boswell, the Commissioner of Competition, said at the time.

Both Rogers and Shaw filed statements stating Boswell’s analysis was incorrect. In a joint statement, the companies say they will continue to work with the commissioner “to highlight the many benefits of the merger.”

Image credit: Shutterstock

Source: Rogers

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Minister Champagne repeats the need for affordability on Rogers-Shaw merger

Minister of Innovation, Science and Industry, François-Philippe Champagne, said his main focus of all the transactions surrounding Rogers takeover of Shaw is affordability.

“My role is to make sure that rates are affordable, and in Canada, that we have more competition and innovation,” he told reporters at the Collision conference in Toronto.

Speaking on the sale of Freedom Mobile to Québecor lead to a similar answer, with Champagne telling the crowd his department will examine telecom affordability when a submission is made about the sale.

“What is going to be framing our decision is going to make sure that rates are more affordable [and] that we have more competition in Canada that can foster innovation for decades to come.”

Champagne has repeated these words a number of times in the last weeks, an idea that was also shared in a report the industry and technology committee tabled in March, asking Champagne to reject the merger if Shaw’s wireless licenses for Freedom Mobile aren’t sold off.

Rogers since agreed to sell Freedom to Montreal-based Québecor and the deal is waiting on approval from regulatory bodies. But whether or not the sale will answer Champagne’s quest for affordability is yet to be determined.

According to reporting from the Toronto Star, critics say the side deal won’t bring lower wireless prices for Canadians.

John Lawford, executive director of the Public Interest Advocacy Centre, told the publication Québecor won’t be as aggressive as an independent competitor because if the company impacts the wireless services of the Big Three outside of Quebec, they can reduce their prices and take their valuable customers in Quebec.

David Soberman, professor of marketing at the University of Toronto’s Rotman School of Management, also told the publication he doesn’t believe the transaction will reduce prices.

“If what we’re looking for is a situation where there’s truly competition and truly a reduction in phone rates, I don’t think this is going to have much of an effect,” he told the Toronto Star.

The $26-billion Rogers-Shaw merger is also facing pushback from the Competition Bureau over claims the Rogers and Shaw merger will reduce competition.

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Mobile Syrup

Globalive reinforces its Freedom Mobile bid through network partnership with Telus

Globalive has signed a network and spectrum sharing agreement with telecom giant Telus to make Freedom Mobile available nationwide if successfully acquired by Globalive.

The agreement will last 20 years.

Rogers is currently in the process of selling Freedom Mobile, which is part of Shaw’s network. Rogers’ executives hope the move will appease competition concerns and aid its $26 billion merger with Shaw.

Globalive says the agreement with Telus will allow the company to deliver services with lower pricing and a quality network, “establishing a vigorously competitive environment for decades to come.”

The company says the partnership will eliminate any possibility of Rogers reacquiring Freedom Mobile.

“Canada needs a truly independent fourth carrier to ensure consumers have the benefits of a competitive market and a level playing field,” Anthony Lacavera, Globalive’s chairman, said. “We’re excited to bring Canadians closer to that reality with this transformational announcement.”

The historic deal with Telus marks the first time an established network has entered into an agreement with an independent competitor, Globalive says.

Globalive founded Wind Mobile in 2008 and sold it to Shaw for $1.6 billion in 2015. The company was renamed Freedom Mobile in 2016.

Lacavera has been vocal about his company’s desire to acquire Freedom Mobile and has made an offer worth $3.75 billion. 

“We’re the only ones that have competed successfully against the big three in the last 30 years. We’re the only ones that built a viable competitor that was standalone and independent,” Lacavera told MobileSyrup in March. 

But Globalive’s offer isn’t the only one on the table. Xplornet and Québecor have also been in talks to acquire Freedom Mobile, along with a group of buyers consisting of LiUNA Pension Fund of Central and Eastern Canada, the Musqueam Capital Corp, the Tsleil-Waututh Nation, Fengate Asset Management, and Aquilini Equities.

Source: Globalive Capital 

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Anthony Lacavera reaffirms his offer to buy Freedom Mobile

Three weeks after Rogers presented Xplornet as the apparent acquirer of Freedom Mobile to the federal government, the company has provided no indication the wireless asset owned by Shaw is close to being sold off.

The Globe and Mail broke the news in April and recently followed up with a report stating Québecor was also in talks with Rogers to acquire Freedom Mobile. This clarifies that no deal is set in stone, and a third bidder, Globalive wants to re-enter the action.

The group’s chairman, Anthony Lacavera, says his $3.75 billion offer is still on the table.

“Our offer stands. It’s a funded, fully financed offer. We’ve presented Rogers with evidence of the funding partners,” Lacavera told the Financial Post, adding he plans on contacting Rogers this week.

Lacavera started Freedom Mobile in 2009. It was called Wind Mobile, but Shaw rebranded it after buying the company.

Rogers says it’s selling off Shaw’s wireless assets to deal with competition concerns brought on by Canada’s Competition Bureau. But the federal body is opposing the merger, having filed applications to block the deal on May 9th.

As the Financial Post points out, it’s unclear if Freedom Mobile’s sale to Lacavera would resolve the concerns of the Competition Bureau.

Source: Financial Post 

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Rogers introduces new advisory members of proposed THINKLab

Rogers has introduced the first members of a new advisory council that will oversee their Calgary-based technology centre to train new tech graduates.

The THINKLab will focus on technology and engineering. Rogers will only create the centre once its $26 billion merger with Shaw is completed.

The inaugural members include the CEO of the Calgary Chamber of Commerce and the Schulich School of Engineering dean at the University of Calgary.

The THINKLab will open 500 technology roles focusing on various aspects, including engineering and technical delivery across networks.

Rogers’ chief technology officer, Jorge Fernandes, will serve as the head of the proposed institution.

“We are excited to introduce the first esteemed members of our new advisory board, each an expert and leader in their own field, who will help guide this critical technology and engineering hub,” he said.

“THINKLab will leverage the incredible talent pool in Western Canada, while also bringing together the brightest academic talent across Canada to research, develop and deliver leading technology infrastructure and services to Canadians.”

The merger has only received approval on the broadcast aspect from the Canadian Radio-television and Telecommunications Commission (CRTC) and has faced fierce criticism.

The latest pushback comes from the Public Interest Advocacy Centre and the National Pensioners Federation. The two advocacy groups argue Rogers’ plans to transition Shaw cable TV and satellite TV customers to IPTV will see them pay more for television services.

The proposal still needs to be approved by the Competition Bureau and Innovation, Science and Economic Development Canada. Approval would see Rogers selling off Shaw’s wireless business Freedom Mobile to create a fourth wireless competitor. The Globe and Mail reported Rogers presented Xplornet as their preferred buyer.

Source: Rogers

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Anthony Lacavera says Rogers’ sale of Freedom Mobile an “engineered process”

Anthony Lacavera, the founder and former CEO of Wind Mobile, is calling on the government to reject Rogers proposed offer to have Xplornet acquire Freedom Mobile.

Lacavera is also the chairman of Globalive, a group that has shown extreme interest in acquiring Freedom Mobile. According to the Globe and Mail, Lacavera sent a letter to several government officials, including François-Philippe Champagne, the Minister of Innovation, Science, and Industry.

The letter states Rogers omitted Globalive and other potential bidders in the process, denying Freedom Mobile was even for sale.

Lacavera warns the government to be “highly skeptical of any transaction presented to you that is a product of this non-competitive and engineered process, which appears to have as its goal the establishment of an anemic and ineffective owner of the fourth carrier business.”

The deal with Xplornet, also first reported by the Globe and Mail, is something Rogers isn’t commenting on. “We’re not going to comment on any rumours that are out there,” CEO Tony Staffieri said during the 2022 Q1 results conference call.

The government has not publicly commented on the sale, and Lacavera is utilizing that silence.

He’s released numerous messages on social media platforms telling Canadians Freedom Mobile needs to be acquired by an independent carrier.

His most recent public plea comes through survey results commissioned by Globalive.

According to the results, 67 percent of respondents want the company to be sold to an independent carrier to ensure increased competition. 87 percent of respondents list a commitment to lower prices as the most critical factor in the sale of Freedom Mobile.

“It’s crucial that we continue to demand a transparent sale process on behalf of Rogers, and that the appropriate discretion is used at the federal level when choosing a final buyer. We are counting on Minister Champagne to make the decision that is in the best interests of Canadians,” Lacavera said.

Source: Globalive and the Globe and Mail

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Freedom Mobile dealers sue company for alleged losses

A group of independent Freedom Mobile franchise dealers have filed three lawsuits against the company.

The dealers have been “negatively and severely impacted by Freedom’s programming and compensation plans effecting the network,” a press release outlining the lawsuits states.

“The lawsuits seek damages for each of the dealers representing the alleged losses they have suffered as a result of Freedom’s operation of their various channels of distribution and in the compensation paid to the dealers.”

The negative impact started in early 2020 and increased following Rogers’ announcement to acquire Shaw.

The lawsuits were filed on behalf of the Association of F-Branded Wireless Dealers. The group represents 22 independent franchised dealers and dealer groups. They collectively operate 180 stores in Ontario and Alberta.

Rogers is currently in the process of selling off Freedom Mobile.

“Although the Freedom dealers do not know the future of the Freedom brand as a result of the uncertainty as to who will in fact acquire the assets of Freedom Mobile, the dealers remain hopeful that they will once again have the opportunity to remain a strong force in the marketplace for the benefit of many Canadians,” the press release states.

Source: Sotos LLP

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Rural TV service provider concerned Rogers won’t honour contract once merger with Shaw is finalized

The Canadian Communication Systems Alliance (CCSA) wants the Canadian Radio-television and Telecommunications Commission (CRTC) to stop Rogers from shutting down the satellite delivery of television signals it receives from Shaw.

In a press release, CCSA says Shaw delivers TV signals to rural and Northern cable companies with no other way of accessing them.

A critical component of the delivery is HITS-QT Plus, an essential program for operators who use satellite signals.

At the Rogers-Shaw hearing the CRTC held in November, Rogers told the CCSA they would maintain the service, Jay Thomson, CCSA’s CEO, said. The CRTC added it would hold Rogers to account.

But not long ago, Shaw said HITS-QT would shut down, according to a press release from the CCSA says. The move threatens to shut down TV services for 10,000 rural and Northern Canadians across 30 communities.

The news of the shutdown was shared “just prior” to the CRTC’s decision to approve the Rogers-Shaw merger.

In that decision, the CRTC ruled Rogers must honour all contracts it inherits from Shaw, and now the CCSA is worried promises to maintain the service won’t be a part of it.

“We call on the CRTC to honour its commitment to keep Rogers from allowing that to happen,” Thomson said. “Otherwise, thousands of rural and Northern Canadians could be deprived of television service in a matter of months.”

MobileSyrup has reached out to Rogers and the CRTC for comment and will provide an update once available.

Source: CCSA

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CRTC approves Rogers-Shaw merger

The Canadian Radio-television and Telecommunications Commission (CRTC) has approved Rogers’ acquisition of Shaw’s broadcasting services.

Rogers will acquire 16 cable services, a national satellite television service and other remaining broadcast and television services, the CRTC says.

More to come.