Rogers still expects Shaw deal to close in Q2

Rogers Communications Inc. CEO Tony Staffieri has said that last week's announcement from Innovation Minister François-Philippe Champagne, in which he said he would not allow the 'wholesale' transfer of Shaw Communications Inc.'s spectrum assets to Rogers as part of the latter's acquisition, was "very helpful in terms of articulating their broad view" and that it didn't surprise the company. "The statement from the minister last week, we think was very helpful in terms of articulating their broad view, which is – on the wireless side – what they'd like to see is a continued fourth player in the marketplace," Staffieri said in response to a question from Scotiabank analyst Jeff Fan at the 2022 edition of the Scotiabank Telecom, Media & Technology Conference Tuesday afternoon. Staffieri also sought to reiterate that the merger with Shaw is "a cable acquisition for , and a cable deal," and said he still expects the deal to close in the second quarter of 2022. "That's 90 per cent of the transaction for us and that's what we're focused on. And on the wireless side, we'll continue to work with the regulatory bodies on a solution that's going to achieve their objective," Staffieri said. That fourth player, whoever it is in the case of a mandated divestment of Shaw's wireless assets as part of a regulatory approval, "will be weaker than what Shaw has been," according to BCE Inc. chief financial officer Glen LeBlanc. "It will be a wireless-only player; will likely have a weaker balance sheet competing against integrated national operators," LeBlanc said, adding that if the deal is rejected outright then the marketplace is back to status quo. "I would say that we're comfortable, fairly relaxed with any outcome." LeBlanc said, "it really doesn't” concern him should Quebecor Inc. purchase Shaw's Freedom Mobile assets and become a fourth national competitor. "They've had great success in Quebec where they've used a bundling strategy, but obviously that will be very different operating wireless only in the West," LeBlanc said. The Bell executive also pointed to Bell's market share in the western provinces. "Our exposure in the West is limited because we have the lowest market share. I think we actually have an opportunity here," he said. When it comes to mandated divestiture by the Competition Bureau, Bell said it was a strategy that served the company well in acquiring Manitoba Telecom Services Inc. (MTS) in 2017. "It worked well for us when we acquired MTS, the remedy structure we laid out. And that could very well be a roadmap for how Rogers deals with the remedy," he said. "I don't know how the government would view that, whether they deem that divestiture of assets in Manitoba worked in their eyes, but for us we feel it worked well.” Telus Corp. and Bell are both currently in court trying to block Quebecor's 2021 acquisition of set-aside spectrum in the western provinces in the 3,500 MHz band. Staffieri also said that there appears to be an easier path towards approval from the CRTC, which is responsible for the cable side of the deal with Shaw. "There seems to be a good path to get the right outcome on the cable side of the assets. And so we're not foreseeing any significant issues as we continue to work through that. But we'll continue to wait for the ultimate decision." — Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca

Rogers still expects Shaw deal to close in Q2

Broadcast | March 8, 2022

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Rogers still expects Shaw deal to close in Q2

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