The proposed $ 26 billion merger between two of Canada’s telecommunications titans has hit a new regulatory hurdle after the competition commissioner said he intended to block the deal.
Rogers Communications Inc. and Shaw Communications Inc. issued a joint statement late Friday night stating that they had learned of the commissioner’s plans after the markets closed for the day.
The companies say they have been informed that the commissioner intends to apply to the Competition Court in an attempt to prevent the merger, which the two companies hoped to complete by the end of the second quarter.
The Competition Bureau is one of the three regulatory bodies whose approval is required to complete the transaction. The Canadian Broadcasting and Telecommunications Commission signed earlier this year and companies are actively trying to sell the wireless business to the Freedom Mobile Show, which is expected to be a condition for Canada’s approval for innovation, science and economic development.
The Competition Bureau did not immediately respond to a request for comment on the decision to fight the future merger, and neither Rodgers nor Shaw offered details on the content of Friday’s announcement.
But both companies say they plan to continue the deal and fight the commissioner’s efforts to block it.
The proposed merger, they say, will offer significant economic and consumer benefits, and they say the deal is in the best interests of Canada and its people.
Rodgers and Shaw will oppose the request to prevent the deal from being made by the Competition Commissioner, while continuing to engage constructively with the Competition Bureau in an effort to resolve this issue and ensure that the benefits of the deal can be to be implemented by all Canadians, “the joint statement said.
The Competition Commissioner’s announcement is the latest in a series of hurdles that have plagued blockbuster merger plans since they were first announced in March 2021.
Late last month, two consumer groups filed a petition asking the federal cabinet to “overturn” CRTC’s decision to approve the transfer of Shaw’s broadcasting services to Rodgers, arguing that it would lead to “significant increase in prices “of television services.
Another variable in the saga is the sale of Freedom Mobile’s assets.
In a joint statement Friday, Rodgers and Shaw reaffirmed their commitment to sell the freedom “in order to address concerns raised by the Commissioner for Competition.”
This Canadian Press report was first published on May 7, 2022.
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