Rogers CEO ‘Confident’ Shaw Deal Will Close, Mediation Talks Begin Next Week
Rogers CEO Tony Staffieri recently sat down for an hour-long interview with The Globe and Mail where he talked about his leadership style, July’s nationwide Rogers network outage, and the company’s embattled $26 billion acquisition of Shaw Communications.
Staffieri said he is “confident the deal will close” despite the Competition Bureau’s petition to block it. The federal Competition Bureau believes the merger will lead to less competition and higher prices in the wireless space.
Rogers and Shaw have agreed to sell the latter’s wireless unit, Freedom Mobile, to Quebecor for $2.85 billion to relieve the Bureau’s concerns. The remedy hasn’t convinced the Bureau so far, but Staffieri hopes that will change when all four parties begin mediation talks next week.
Staffieri is confident in the Freedom deal being enough to bring the Bureau around. As part of the deal, Rogers will provide the network services that Quebecor needs to expand in Ontario, Alberta, and British Columbia.
Backup from Rogers should give Quebecor the scale it needs to be aggressive in pricing. “Quebecor will have a better cost structure than they would have had on their own,” Staffieri explained. At least one analyst from Scotiabank agrees with Staffieri’s assessment of the deal, noting that Quebecor could lower wireless prices in much of Canada as it did in its home province of Quebec.
If negotiations fail, as they did before, the Competition Tribunal will hold hearings on the deal in November. A ruling would then be expected sometime in early 2023, and both sides will have the option to appeal.
What’s more, Industry Minister François-Philippe Champagne is holding out his approval of the deal as well.
On the subject of the July network outage, Staffieri outlined how Rogers is responding.
“We have to own it, we have to be accountable,” the CEO said. Rogers has given out $150 million in customer credits as compensation for the outage, which will take a chunk out of the telco’s third-quarter profits, and further committed billions in capital investment to strengthen its network and prevent future outages. “If we don’t have the best network, we don’t have a business.”
Staffieri had a whirlwind of a promotion to the CEO spot last year, and the ride since has been fairly rocky. His appointment was rife with drama, following weeks of boardroom and courtroom battles, the ousting of former CEO Joe Natale, and a family feud that pit Edward Rogers against his late mother Loretta and sisters Martha and Melinda Rogers-Hixon.
You can check out Staffieri’s full interview over on The Globe and Mail.
Update (Sunday): The title of this story was edited for clarification.