Canada’s Competition Bureau on Friday reiterated the $26 billion merger of Rogers and Shaw should not proceed, as the deal threatens competition.
The Bureau was responding to a petition filed by both companies earlier in June, when it also said it wanted to fast-track the tribunal hearing on the case.
With Rogers and Shaw setting July 31 as its date to close the deal, that appears to be in jeopardy if litigation takes place at the Competition Tribunal, reports Reuters.
The Bureau reiterated Rogers selling off Shaw’s wireless assets in the form of Freedom Mobile was not good enough, and the move would weaken the latter, ultimately removing the “competitive discipline” it would have against incumbents.
The filing response also said the Rogers-Shaw deal “will result in a transfer of wealth from low- and moderate-income groups in society to the Respondents, whose shareholders include ultra-rich members of the family ownership groups of these companies.”
“Increased profits will also be paid to non-Canadian investors. These effects are socially adverse and otherwise must be given weight against any efficiencies that may arise,” added the filing, reports The Globe and Mail.
Claims from Rogers that there would be economic benefits from swallowing up Shaw were deemed as speculative and “grossly exaggerated,” said the Bureau, citing they were based on flawed methodologies and unrealistic assumptions.
Canada’s Competition Tribunal releases schedule for process over Rogers Shaw mergerhttps://t.co/xDeshdACpF
And @CompBureau’s replies to initial filings by merging parties:
Reply to Rogers: https://t.co/r0kjbFb1wK
Reply to Shaw:https://t.co/7bXFRBZlzg#CRTC— Ben Klass (@BenKlass) June 17, 2022
Back in May, the Competition Bureau said it would seek a full block of the Rogers-Shaw merger and seek an injunction to halt the deal. Both Rogers and Shaw agreed to put their deal on hold until the Competition Tribunal makes its decision on the case.
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If wireless isn’t included, how is competition diminished?
I think it’s because whatever this Freedom-like company is, they will be at a disadvantage because they will be unable to offer the types of value-added features that the others can offer as bundles due to their Wired or Content holdings.
(Such as Bell being able to offer Crave Mobile, or Shaw being able to offer low low prices via Shaw Mobile).
Which is fair to a certain extent, but Freedom Mobile was making waves in the wireless space way before Shaw owned them…
Canadians don’t want same prices but with like 5 value-added items…
They just want lower prices for whatever they choose to use their phones for. If they want to use it to stream crave, Let them pay for it separately.
Because the remaining competitors will have the unfair advantage of feature-rich products that can be bundled.
When you unbundle mobile access it diminishes its absolute & perceived value significantly.
This is the case in markets globally.
Because the remaining competitors will have the unfair advantage of feature-rich products that can be bundled.
When you unbundle mobile access it diminishes its absolute & perceived value significantly.
This is the case in markets globally.