Rogers-Shaw Mediation Talks with Competition Bureau Have Failed
“The early mediation between Rogers Communications Inc., Shaw Communications Inc., and the Commissioner of Competition on July 4 and July 5, 2022, did not result in a resolution of the Commissioner’s objections to the proposed merger,” Shaw told iPhone in Canada in an email.
The Rogers-Shaw deal is being scrutinized by the Competition Bureau and still needs approval from the Ministry of Innovation, Science and Economic Development (ISED) Canada. Arguments against the merger are that it will reduce competition and raise prices in Canada’s already oligopolistic wireless space.
Canada’s Competition Bureau last month petitioned the Competition Tribunal to block the deal entirely. It continues to oppose the merger despite Rogers and Shaw having agreed to sell the latter’s wireless business, Freedom Mobile.
The two telecom giants began two-day mediation proceedings with Competition Commissioner Matthew Boswell on Monday to see if the matter could be sorted out outside the courts. However, they weren’t able to win the regulator over.
While talks were ongoing, Alberta’s attorney general on Tuesday said the province would intervene in the Bureau’s antitrust review of the planned merger. Shaw Communications has two million wireless subscribers in Alberta.
A notice posted on the competition tribunal’s website said the companies “have significant presence in Alberta’s telecommunications market and their successes and failures will impact Alberta’s consumers, workers, and, potentially, other aspects of Alberta’s economy.”
Since the two sides were unable to come to agreeable terms, the dispute will proceed to trial. Seeing as the Bureau said last month that it was seeking an expedited process, a trial is expected to start in November. The tribunal could then render its decision by year-end.
In its emailed statement, Shaw said that the regulatory review of the takeover will now “continue as previously disclosed. Shaw added that the two companies are “not precluded from continuing discussions with the Commissioner at any time,” hinting that there may still be hope for an out-of-court settlement.
“Rogers and Shaw intend to continue to work constructively with the Commissioner to highlight the many benefits of the merger to all Canadians, including maintaining a strong and sustainable fourth wireless carrier across Canada through the proposed divestiture of Freedom Wireless to Quebecor Inc.”
Rogers and Shaw currently have a July 31 deadline on the merger. If the deal falls through, Rogers will have to pay Shaw $1.5 billion in breakup fees.