Rogers has been working for more than a year to secure all the necessary approvals to close Shaw’s acquisition, which would mean a major expansion in Western Canada for the Toronto-based telecommunications giant. He agreed to buy Shaw in March 2021 for $ 40.50 per share. However, Competition Commissioner Matthew Boswell has dug into his heels to oppose the acquisition of Shaw. His opposition leads to a quasi-judicial hearing before the Competition Court later this year if Rogers fails to allay the competition guard’s concerns sooner. Rogers President and CEO Tony Staffieri set an optimistic tone late Friday when the proposed sale of Shaw’s Freedom in Quebecor was announced. “Our agreement with Quebecor to sell Freedom is a crucial step towards completing our proposed merger with Shaw. … This agreement between proven cable and wireless companies will ensure the continuation of an extremely competitive market with strong futures. “Investing in Canada ‘s world – class networks,” he said. But Boswell has repeatedly suggested that Rogers’s long-term plan to sell Freedom would not be enough to calm him down. “The proposed sale of Freedom Mobile is not an effective remedy,” he said in a filing with the Competition Court last Thursday. However, several analysts said in customer reports Monday that they see a greater chance of allowing Shaw’s acquisition of Rogers now that Quebecor has lined up as a buyer for Freedom Mobile, which could help position the company based in Montreal as a viable fourth national wireless carrier. Here are the highlights of some of the analysts’ comments: “We believe this agreement raises the prospect of the Rogers-Shaw transaction closing to over 95 percent,” wrote Aravinda Galappatthige, an analyst at Canaccord Genuity. It upgraded Shaw Class B shares to buy from booking and raised its price target to $ 40.50 from $ 35.00. Galappatthige also upgraded Rogers to buy on hold, saying the Freedom sale “will likely lead them to the finish line in securing Shaw Cable”. However, it lowered its price target for Rogers Class B shares to $ 69.00 from $ 71.00 as a result of what it called “tougher macroeconomic and lower market valuations”. As for Quebecor, Galappatthige maintained its buy recommendation and price target of $ 30.00 per share. He described the Freedom Agreement as a “mixed bag” for Quebecor, given the opportunities and risks associated with expanding beyond the company’s home country. Jerome Dubreuil, who covers telecommunications for Desjardins Capital Markets, agreed that there was a greater chance Rogers could now conclude its deal with Shaw. “We believe [Quebecor’s] strong business history, balance sheet, know-how and asset mix will make it more difficult for the regulator to argue that the competitive landscape of the Canadian wireless network will be significantly affected by [Rogers/Shaw] merger, “he wrote in a customer report on Monday. Adam Shine of the National Bank of Canada Financial Markets denied Boswell’s opposition to the Rogers-Shaw deal, saying he believed the commissioner was “wrong” [assuming] that Freedom’s buyer can at least not respond to Shaw’s wireless efforts and competitiveness. “ “Anyone looking at Quebec’s strategy in Quebec and gaining a wireless provincial market share of 22.5 percent would find it difficult not to recognize its success and be forced to re-evaluate the above statements. of the results of the last years “, he added. Shine said he believed a negotiated settlement between Rogers, Shaw and the Competition Bureau “would be the best and fastest way” to close the deal. Rogers is also seeking approval from Minister of Innovation, Science and Industry François-Philippe Champagne. Shine has better performance propositions (the equivalent of a market) in each of Rogers, Shaw and Quebecor.
