TORONTO, MONTREAL AND CALGARY – Rogers Communications Inc. (“Rogers”), Shaw Communications Inc. (“Shaw”) and Quebecor Inc. (“Quebecor”) today announced that they have entered into a definitive agreement (the “Agreement”) for the sale of Freedom Mobile Inc. (“Freedom”) to Videotron Ltd., a subsidiary of Quebecor (the “Freedom Transaction”), subject to regulatory approvals and closing of the merger of Shaw and Rogers announced on March 15, 2021 (the “Rogers-Shaw Transaction”) .
The parties strongly believe the Freedom Transaction provides the best opportunity to create a strong fourth national wireless services provider and addresses the concerns raised by the Commissioner of Competition and the Minister of Innovation, Science and Industry regarding the Rogers-Shaw Transaction. With this Agreement, the new combined business of Videotron and Freedom will be well-positioned to launch a strong, competitive national 5G offering, using Videotron’s 3500 MHz holdings. Accordingly, the parties believe the Rogers-Shaw Transaction should now be approved.
This definitive agreement is substantially consistent with the terms previously announced on June 17, 2022.
“We are very pleased with this Agreement, and we are determined to continue building on Freedom’s assets,” said Pierre Karl Péladeau, President and CEO of Quebecor. “Quebecor has shown that it is the best player to create real competition and disrupt the market. Our strong track record combined with Freedom’s solid Canadian footprint will allow us to offer consumers in British Columbia, Alberta and Ontario more choice, value, and affordability through discounted multiservice bundles and innovative products.”
“This Agreement with Quebecor brings us one step closer to completing our merger with Shaw,” said Tony Staffieri, President and CEO of Rogers. “We strongly believe that this divestiture solution addresses the concerns raised by the Commissioner of Competition and the Minister of Innovation, Science and Industry and we look forward to securing the outstanding regulatory approvals for our merger with Shaw so that we can start delivering its significant long -term benefits to Canadian consumers and businesses, including improved network resiliency.”
“My family, our management team, and our people are extremely proud of what we built with Freedom Mobile. Over the past six years we invested billions of dollars and launched products and services that disrupted the marketplace and helped redefine what Canadians can expect from their wireless carrier, but there’s much more that could be done as next generation networks are deployed, technology becomes more sophisticated and consumers’ demands for fast and responsive applications continue to increase,” said Brad Shaw, Executive Chairman and CEO of Shaw. “Bringing Freedom Mobile and Quebecor together will expand Freedom’s scope to create a national provider with greater ability to invest and compete for the future growth and technology Canadians will need.”
Required Approvals
The Freedom Transaction is conditional on, among other things, clearance under the
Competition Act and approval of the Minister of Innovation, Science and Industry. It is also conditional on, and would close substantially concurrently with, the closing of the Rogers-Shaw Transaction. As previously announced, Rogers, Shaw and the Shaw Family Living Trust have agreed to extend the outside date of the Rogers-Shaw Transaction to December 31, 2022 (which outside date may be further extended to January 31, 2023 at the option of Rogers or Shaw, provided Rogers has committed financing available to complete the merger), demonstrating their commitment to completing this transformative combination.
The Rogers-Shaw Transaction, which would see Shaw merge with Rogers, has already been approved by the shareholders of Shaw and the Court of Queen’s Bench of Alberta, and the Canadian Radio-television and Telecommunications Commission, and remains subject to review by the Competition Tribunal and approval by the Minister of Innovation, Science and Industry. The Commissioner of Competition has applied for an order of the Competition Tribunal that the parties not proceed with the Rogers-Shaw Transaction, and closing of the Rogers-Shaw Transaction is conditional on either agreement with the Commissioner of Competition or the Competition Tribunal disposing of the application on terms that allow the transaction to close.
Rogers’ standalone financial guidance for 2022, provided on April 20, 2022, remains unchanged.