Rogers and Shaw Agree to Sell Freedom Mobile to Quebecor for $2.85 Billion
Rogers, Shaw and Quebecor announced late Friday evening the companies have agreed to sell Freedom Mobile to the Quebec-based telecom, after numerous reports the latter was in the running to acquire the wireless unit.
“The proposed divestiture of Freedom Mobile to Quebecor will ensure the presence and viability of a strong fourth wireless carrier in Canada,” explained Rogers. The company says Quebecor “brings an undeniable operational and competitive track record, as well as significant financial resources.”
According to all companies involved, they note the sale of Freedom Mobile to Quebecor should address concerns about the Rogers-Shaw deal raised by the Commissioner of Competition and the Minister of Innovation, Science and Industry, regarding wireless competition.
Quebecor says it will agree to purchase Freedom Mobile for $2.85 billion to expand its wireless offerings nationwide, including a 5G network. The deal would include Freedom Mobile’s wireless and internet customers, along with its infrastructure, spectrum and retail stores. It also includes transport services and roaming from Shaw and Rogers.
“Our agreement with Quebecor to divest Freedom is a critical step towards completing our proposed merger with Shaw. We strongly believe the divestiture will meet the Government of Canada’s objective of a strong and sustainable fourth wireless services provider,” said Tony Staffieri, President and CEO of Rogers, in a statement. “This agreement between proven cable and wireless companies will ensure the continuation of a highly competitive market with robust future investments in Canada’s world class networks. We look forward to securing the outstanding regulatory approvals for our merger with Shaw so that we can deliver significant long-term benefits to Canadian consumers, businesses and the economy.”
“This is a truly Canadian-made solution that will benefit all Canadians by delivering increased competition and choice, the next generation of telecommunications services and enabling the transformative benefits of a combined Rogers and Shaw. We look forward to completing the Shaw Transaction which would make Rogers a truly national telecommunications provider,” said Edward Rogers, Chairman of Rogers Communications, on Friday evening.
“This is a turning point for the Canadian wireless market,” proclaimed Pierre Karl Péladeau, President and CEO of Quebecor. “Quebecor’s Videotron subsidiary is the strong 4th player who, coupled with Freedom’s solid footprint in Ontario and Western Canada, can deliver concrete benefits for all Canadians. We have always believed that for there to be healthy competition in wireless services only a player with a proven track record can successfully enter the market. This is a value-added transaction for all consumers and the Canadian economy. After fifteen years of growth in the Quebec wireless market, we have demonstrated our expertise, our ability to innovate and our financial strength. Now we are taking another step to bring the opportunities our customers already enjoy to consumers across Canada.”
“Today’s announcement marks an important milestone in our bold and transformative journey to join together with Rogers,” said Brad Shaw, Executive Chairman and CEO of Shaw. “Since Shaw entered the wireless business in 2016, we have made significant strides towards changing the Canadian wireless landscape. We made a promise to Canadians that we would increase choice and affordability and I’m proud to say we delivered on that promise. Today’s announcement ensures that Freedom Mobile will remain a strong competitor.”
This deal is conditional upon the Competition Act plus approval from ISED of the Rogers-Shaw deal.
The Competition Bureau earlier today reiterated it will oppose the Rogers-Shaw deal. The Minister of Innovation, Science and Industry (ISED) has yet to decide on supporting the merger.