Rogers Communications Inc. is set to to acquire rival Canadian cable giant Shaw Communications Inc. in a $16 billion deal (C$20 billion), the companies said Monday. If approved, the merger would unite the country’s two largest cable providers.
Per the companies, the C$40.50-per-share cash offer transaction is not conditional upon financing and has the support of Shaw’s board. The Shaw family will become one of the largest shareholders in Rogers upon closing, with Shaw executive chair and CEO Brad Shaw set to join the Rogers Board of Directors.
According to Rogers and Shaw, “This transaction will create Canada’s most robust wholly-owned national network, and as a result of the combined spectrum holdings and enhanced capacity, will generate more choice and competition for businesses and consumers, as well as realizing the full benefits of next generation networks for Canadians and Canada’s productivity.”
The companies’ statement continued, “The combination will accelerate the delivery of critical 5G service across Western Canada, from rural areas to dense cities, more quickly than either company could achieve on its own. This will be accomplished by bringing together the expertise and assets of both companies, including Shaw’s existing cable, fibre, and wireless networks and Rogers’ robust national wireless network and extensive 5G capabilities.”
The deal — which is valued at C$26 billion, including C$6 of Shaw’s existing debt — is subject to approval by the Canadian government. Rogers and Shaw expect the deal to close in the first quarter of 2022.
“We are proud to join forces with the Shaw family and team as we combine our companies and our 10,000 team members across Alberta, British Columbia, Manitoba, and Saskatchewan, supported by a head office in Calgary. Western Canada is a major driver of our national economy and together we will have the scale, expertise and commitment to deliver the technology infrastructure needed to keep local communities connected, businesses competitive and attract new investment,” Joe Natale, president and CEO of Rogers Communications, said. “We’re at a critical inflection point where generational investments are needed to make Canada-wide 5G a reality. 5G is about nation-building; it’s vital to boosting productivity and will help close the connectivity gap faster in rural, remote and Indigenous communities. Fundamentally, this combination of two great companies will create more jobs and investment in Western Canada, connect more people and businesses, deliver best-in-class-services and infrastructure across the nation, and provide increased competition and choice for Canadian consumers and businesses.”
Brad Shaw added: “Our two companies have been successful because of the foresight and vision of two great founders who were driven by their unrelenting pioneering spirit and entrepreneurial values. Without a doubt, my father would be proud of this moment, combining forces with the company founded by his old friend to deliver more Canadians world class connectivity, more choice, and better value. While unlocking tremendous shareholder value, combining these two great companies also creates a truly national provider with the capacity to invest greater resources expeditiously to build the wireline and wireless networks that all Canadians need for the long term. This transaction will create benefits for generations to come.”
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