Canada Approves Rogers’ $14.8 Billion Shaw Deal After Two Years

The Canadian government will allow Rogers Communications Inc. to acquire rival Shaw Communications Inc., concluding one of the biggest corporate takeovers in the country’s history after more than two years.

(Bloomberg) — The Canadian government will allow Rogers Communications Inc. to acquire rival Shaw Communications Inc., concluding one of the biggest corporate takeovers in the country’s history after more than two years. 

Industry Minister François-Philippe Champagne made the announcement at a news conference Friday morning in Ottawa, confirming a report on Thursday by Bloomberg News. He outlined a number of conditions, including a requirement for Rogers to create 3,000 new jobs in Western Canada and spend billions to expand 5G wireless coverage and services. 

The deal unites two billionaire families in a communications firm that will offer wireless, internet and cable television to well over 10 million Canadians from the east coast to the west, with annual revenue near C$20 billion ($15 billion). 

It’s also the realization of a long-held ambition by the Rogers family. The two companies’ founders, the late Ted Rogers and JR Shaw, were friends who sometimes did deals together. Their sons, Rogers Chairman Edward Rogers and Shaw Chief Executive Officer Bradley Shaw, have known each other since they were children. 

Shaw rose 3.3% to to C$40.44 at 11:45 a.m. in Toronto, just below the takeover price of C$40.50 a share. 

Rogers shares initially moved higher, then reversed to trade down 3%. The company issued new financial guidance for the year to reflect the acquisition, which the companies expect to close by April 7.

Champagne on Friday also gave the green light to Quebecor Inc.’s proposal to buy most of Shaw’s wireless business. The two deals were linked. Without the divestiture, Rogers and Shaw wouldn’t have been allowed to complete their merger because it would have given Rogers too much market power. 

The minister took months to decide on the deals, during which he extracted a series of promises from Rogers and Quebecor. Among them, Toronto-based Rogers must maintain a second headquarters in Calgary and follow through on promises to invest C$1 billion on better service to rural, remote and indigenous regions of Canada. 

‘Foundation’ for 5G  

Toronto-based Rogers struck the agreement to buy Shaw for C$20 billion in March 2021. Beyond family ties, analysts and investors had long speculated the two companies would be logical business partners. Rogers is strong in Ontario and the eastern parts of Canada, while Shaw’s domain is the western provinces. 

For Rogers, buying Shaw’s profitable cable and internet businesses is a way to strengthen its networks and gain the kind of scale the company says it needs to compete with BCE Inc., Canada’s largest telecom company, and Telus Corp.

“The Canadian government’s approval of Rogers’ Shaw acquisition will provide the former with an extensive wireline network in western Canada that can serve as a foundation for the broader deployment of 5G in the region,” Bloomberg Intelligence analyst John Butler said in a note. 

The deal was controversial from the beginning, given Canada’s already-concentrated communications sector: Rogers, BCE and Telus command more than 80% of the wireless market. The companies had hoped to close by the middle of 2022, but Canada’s antitrust watchdog sued to block the takeover, saying that it would harm consumers.

Rogers and Shaw then cut a deal with Quebecor, a major provider of cable and wireless service in the province of Quebec. The Montreal-based firm will acquire Freedom Mobile — which represents the majority of Shaw’s 2.3 million wireless accounts — for almost C$3 billion, becoming Canada’s No. 4 player. 

The Quebecor-Freedom deal permitted Rogers and Shaw to argue that they had crafted a solution to any antitrust concerns. They defeated a legal challenge at Canada’s Competition Tribunal in December and prevailed at an appeals court in January. 

The courtroom victories cleared all hurdles but one — the industry minister. Champagne said on several occasions that he was pushing the companies for binding commitments that will improve service and prices, and that he wouldn’t be bound by their timeline for closing. 

Rogers faces fines of as much as C$1 billion if it breaks the conditions of the deal, Champagne said Friday, stressing that he would watch the companies like a “hawk.” Quebecor has also made commitments. It must invest at least C$150 million in Freedom Mobile’s network over the next two years and offer wireless plans that are at least 20% cheaper than competitors’, the minister said.  

“Listen, I’m a lawyer, and it’s a contract, so I know how to read contracts and enforce them,” he said Friday. “I would not mess with the regulator. It’s never a good thing.”

As part of the agreement, Rogers must spend C$5.5 billion on expanding wireless coverage and services — C$2.5 billion of that in Western Canada. 

–With assistance from Mathieu Dion, Danielle Bochove and Doug Alexander.

(Updates with share prices, analyst comment, more information about government’s conditions)

More stories like this are available on

©2023 Bloomberg L.P.