Rogers, Shaw vow to fight competition commissioner's effort to block merger

Court rejects Competition Bureau's appeal Tara Webber of BNN-Bloomberg explains what happens next, now that the Court of Appeal has rejected efforts to block the Rogers-Shaw deal.

TORONTO — The proposed $26-billion merger between two of Canada's telecom titans has hit a new regulatory hurdle after the Commissioner of Competition has indicated it intends to block the deal.

Rogers Communications Inc. and Shaw Communications Inc. issued a joint statement late on Friday evening indicating they learned of the commissioner's plans after markets closed for the day.

The companies say they were informed that the commissioner intends to file applications to the Competition Tribunal in a bid to prevent the merger, which the two firms had hoped to close by the end of the second quarter.

The Competition Bureau is one of three regulatory bodies whose approval is needed for the deal to go through. The Canadian Radio-Television and Telecommunications Commission signed off earlier this year, and the companies are actively trying to sell Shaw's wireless business Freedom Mobile which is expected to be a condition of approval from Innovation, Science and Economic Development Canada.

The Competition Bureau did not immediately respond to request for comment on the decision to fight the prospective merger, and neither Rogers nor Shaw offered details on the contents of the Friday notice.

But both companies say they plan to press ahead with the deal and fight the commissioner's efforts to block it.

The proposed merger, they argue, will offer significant economic and consumer benefits and contend the deal is in the best interest of Canada and its residents.

"Rogers and Shaw will oppose the application to prevent the transaction to be made by the Commissioner of Competition, while continuing to engage constructively with the Competition Bureau in an effort to bring this matter to a resolution and ensure that the transaction's benefits can be realized by all Canadians," the joint statement read.

The notice from the competition commissioner is the latest in a series of obstacles that have plagued the blockbuster merger plans since they were first announced in March 2021.

Late last month, two consumer advocacy groups filed a petition asking the federal cabinet to "set aside"' the CRTC's decision to approve the transfer of Shaw's broadcast services to Rogers, arguing that it will lead to "significant price increases" for television services.

Another variable in the saga is the sale of Freedom Mobile's assets.

Friday's joint statement saw Rogers and Shaw reiterate their commitment to selling Freedom "with a view to addressing concerns raised by the Commissioner of Competition."

This report by The Canadian Press was first published May 7, 2022.