Ottawa Rejects Rogers from Acquiring Shaw’s Wireless Licenses

In an announcement on Tuesday evening, François-Philippe Champagne, Minister of Innovation, Science and Industry, officially denied the transfer of Shaw’s wireless licenses to Rogers, throwing an axe into the deal.

“Earlier this year, I stated that I would—under no circumstances—permit the wholesale transfer of wireless spectrum licences from Shaw to Rogers,” said Champagne.

“Today, I officially denied that request, which had been pending before me. My decision formally closes that chapter of the original proposed transaction,” added the minister.

With Rogers and Shaw’s plan to sell off its Freedom Mobile unit to Videotron for $2.85 billion, Champagne added some conditions to that deal.

“Any new wireless licences acquired by Vidéotron would need to remain in its possession for at least 10 years,” said the minister.

He also added, “I would expect to see prices for wireless services in Ontario and Western Canada comparable to what Vidéotron is currently offering in Quebec, which are today on average 20 per cent lower than in the rest of Canada.”

Champagne continued with the federal government’s talking points on making wireless services more affordable.

“But let’s face it: when it comes to wireless services, Canadians deserve and need better options. Wireless services are essential to our daily lives. They keep us connected to the world around us, to our loved ones and to our jobs,” said Champagne.

“Canadians deserve world-class networks and access to wireless services at affordable and competitive prices. I am resolved to achieve these objectives—full stop. Promoting competition to bring down prices has been at the core of policies advanced by successive governments for many years,” he touted at a press conference.

In response to Champagne’s announcement, Pierre Karl Péladeau, President and CEO of Quebecor, said in a statement, “we are pleased to see that Minister Champagne recognizes and supports the highly competitive environment created by Videotron in Québec’s wireless market over the past several years, which has brought Quebecers the lowest prices and best wireless plans in Canada.”

He added, “we intend to accept the conditions stipulated by the Minister and incorporate them into the new version of the Rogers-Shaw/Quebecor-Freedom Mobile transaction, which has already been negotiated. They are in line with our business philosophy, which has proved highly successful in Quebec, where we have taken a significant market share in a very short span of time. We will work to deliver better prices for Canadians in the other provinces and to end the reign of the ‘Big 3’ by promoting competition, the public interest and the digital economy in Canada.”

Rogers’ CEO said earlier this week he was ‘confident’ the deal with Shaw would complete. Both Rogers and Shaw are set to begin mediation talks with the Competition Bureau next week regarding the merger, with the latter citing antitrust concerns regarding the deal.

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