Rogers, Shaw Close In On Billion-Dollar Merger

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TORONTO — In a decision that effectively plows through a giant snowbank created by the Commissioner of Competition for the nation of Canada, with only one individual — Francois-Philippe Champagne — empowered to block it, Rogers Communications’ proposed $15 billion merger with Shaw Communications — which includes a spin off Shaw’s Freedom Mobile unit to Québec-based Vidéotron — has been given the green light by the Federal Court of Appeal in Ottawa.


In a highly anticipated one-day hearing held at 9:30am Eastern on Tuesday (1/24), the Honourable David W. Stratas declined to overturn a lower judicial body’s decision to approve the deal, which was done in December 2022.

The Competition Bureau of Canada responded by appealing the tribunal’s ruling to make the deal between Rogers, Shaw and Vidéotron happen.

“We defer to the tribunal, in fact, quite significantly,” Justice David Stratas told the court, Financial Post reported. Stratas said the court rendered the tribunal’s decision as if it had been made in a Canadian federal court. “It will be pointless to send this case back to the Competition Tribunal for re-decision,” he said.

With the decision, approval is simply needed by Innovation, Science and Economic Development Canada (ISED), led by Champagne. His signature is expected. When that happens, bottles of champagne will likely popped at Rogers headquarters.

According to Financial Post, a House of Commons committee, which plans to make recommendations to Champagne, is on track to hold a meeting on Wednesday (1/25) to review the deal’s details.

To say Stratas’ ruling was a strong one is perhaps an understatement. He told both parties that the court can only interfere if the tribunal committed “palpable and overriding errors” in its decision, which one judge said is “a very high test.”

As such, Stratas told the bureau’s lawyers on Tuesday morning, “According to the tribunal, this was not a particularly close case. It found, I would say on the evidence, rather decisively that there was no substantial lessening of competition and in saying that, ‘I want to hear your points about legal error.’”

That statement all but ends a quest by Matthew Boswell, the Commissioner of Competition, to fight against the blockbuster mega-merger, which is today worth $14.96 billion USD rather than $19.2 billion USD when initially announced, due to a lower value of the Canadian dollar. The transaction’s value is $20 billion CDN.

According to Reuters, the judges delivered their verdict in the afternoon without hearing from Rogers and Shaw.

Boswell had 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.

— With reporting from RBR+TVBR in North York, Ontario