(Toronto) The proposed merger of two Canadian telecommunications giants faces new obstacles after the federal competition commissioner announced his intentions to block it.
Posted at 11:04 a.m.
In a joint statement issued late Friday evening, Rogers Communications and Shaw Communications said they had been notified of the commissioner’s intention to file applications with the Competition Tribunal to challenge the proposed merger.
The two companies have indicated that they “will oppose the application filed by the Commissioner of Competition to challenge the proposed merger, while continuing to work constructively with the Competition Bureau.”
The Competition Bureau is one of three regulators that must approve the deal. The Canadian Radio-television and Telecommunications Commission (CRTC) has already given the green light to Rogers Communications’ acquisition of Shaw’s broadcasting services, subject to certain conditions and modifications.
Shaw is trying to sell its Freedom Mobile wireless phone service. This sale is expected to be one of the conditions set by the federal Department of Innovation, Science and Economic Development.
The Competition Bureau did not respond to a request for comment.
Shaw and Rogers intend to move forward.
According to them, the proposed merger will give them “the capabilities to invest in digital infrastructure, create jobs, drive innovation, increase choice and bridge the digital divide”. It will provide “significant long-term benefits to the general public, businesses and the economy”.
Obstacles
The Competition Bureau’s denial is the latest in a series of hurdles the proposed merger has had to clear since it was announced in March 2021.
Last month, two consumer groups filed a motion asking the federal cabinet to “overturn” the CRTC’s decision to approve the transfer of Shaw Communications’ broadcast services to Rogers Communication, arguing that it will result in “increases important price points” for television services.
Another variable in the equation is the sale of Freedom Mobile’s assets. Rogers and Shaw reiterated their commitment to sell the company “in order to address concerns raised by the Commissioner of Competition and ISED”.