TORONTO — In a new and somewhat unexpected twist in the long, winding road to the end of a merger originally anticipated to close at the end of 2022 and as of December 30 was predicted to see a January 31 completion, the Commissioner of Competition for the nation of Canada has won a January 24 hearing against Rogers Communications and Shaw Communications at the Federal Court of Appeal.
It throws another obstacle at company executives who had been on track to complete the blockbuster $19.2 billion USD merger, which includes a spin off Shaw’s Freedom Mobile unit to Québec-based Vidéotron.
The Honourable David W. Stratas agreed to a one-day hearing scheduled for 9:30am Eastern on January 24, in Ottawa.
Until then, a stay is in place preventing the deal from closing until the court issues its ruling.
That could come before January 31. If not, the entire deal could come crashing down, legal representatives to Rogers, Shaw and Videotron hinted on Tuesday.
The appeal was not expected. In fact, it was widely understood that, with the Competition Bureau’s defeat, the Canadian Minister of Innovation, Science and Industry was the only remaining hurdle to pass.
Now, that individual, Francois-Philippe Champagne, must wait as Matthew Boswell, the Commissioner of Competition fighting against the blockbuster mega-merger, has won an appeal of the Competition Tribunal’s decision.
“I am very disappointed that the Tribunal is dismissing our application to block the merger between Rogers and Shaw,” Boswell said in a brief statement released December 29 and shared by Rogers’ CityNews. “We are carefully considering our next steps.”
Few expected Boswell to appeal. However, for opponents of the deal, it could be relished. Boswell has argued that combining Shaw and Rogers would diminish competition in Canada’s telecommunications marketplace, resulting in higher wireless services bills for customers and a decline in service. Rogers has already been hammered for its massive July 8, 2022 service outage.
For the Tribunal, the core issue in this proceeding was whether a proposed acquisition of Shaw by Rogers, modified to include the Freedom Mobile spin to Québec-based Videotron Ltd., “is likely to prevent or lessen competition substantially in the provision of wireless telecommunications services” in two key provinces — Alberta and British Columbia.
With the spin of Freedom Mobile, Rogers would require the remainder of Shaw through an amalgamation arrangement.
For Boswell and his team, that isn’t enough. Now. he will get one final attempt at killing a transaction two years in the making.
— With reporting from RBR+TVBR in North York, Ont.
