Concerned about Rogers-Shaw deal: Cogeco’s Jetté

After surviving a hostile takeover bid by Rogers Communications Inc. in September, Cogeco Inc. president and CEO Philippe Jetté said Tuesday that Rogers' acquisition of Shaw Communications Inc. presents a great deal of "uncertainty." Speaking at this year's online edition of the Desjardins Industrials, Telecom, Media & Tech, Diversified and Consumer Conference, Jetté called on regulators to review the deal closely. "Canadians today, I think, are concerned about this proposed merger, and I think for the right reasons," Jetté said. "I think it's concerning: the way it's being presented, and consolidating even further the market power that the big three — not only Rogers — actually have in their possession." Speaking at a BMO investor conference in September, Cogeco chief financial officer Patrice Ouimet speculated that Rogers' takeover attempt — an $11 billion offer made alongside New York-based Altice USA Inc. — was driven in part by an attempt to stop Cogeco from getting into the wireless market. “As you know, we are attempting to get into the wireless space. We bought spectrum over time…we’ve proposed a hybrid MNO framework to the CRTC,” Ouimet said at the time. On Tuesday, Jetté reiterated his company's desire to get into the wireless space, and called again on the CRTC to release its decision on mandated access for mobile virtual network operators (MVNOs). Cogeco has proposed a hybrid mobile network operator (HMNO) model, under which companies like Cogeco that have broadband facilities would be allowed access to existing wireless networks, as long as the HMNO reinvests in its own infrastructure. "I think the government, this time, has to induce a framework. The regulatory framework needs to be mandated, and not just left to the three big guys to decide what they want to do with the market, so it needs to be mandated to create a wireless wholesale access to their networks and help smaller players to grow," Jetté told the conference. Cogeco has also been tipped as a potential buyer for Shaw's Freedom Mobile wireless assets, should the Competition Bureau and Innovation, Science, and Economic Development Canada force its divestment as a condition of approving the Rogers-Shaw deal. "There's a greater deal of uncertainty as far as we're concerned as to whether the deal will be approved if wireless assets will be for sale, the implied economics of all of this," Jetté said Tuesday, stopping short of saying whether Cogeco is interested in Shaw's wireless assets should they be put up for sale. Speaking later at the conference, Rogers CEO Joe Natale said he was optimistic about the regulatory process. "We're confident that we can reach an agreement with those three governing bodies, and come out the other side," Natale said. "It's hard to look at the future without considering some very important aspects from a regulatory point of view and from a policy framework point of view," he said, pointing to the digital divide between urban Canada and the less-connected rural parts of the country. Rogers chief financial officer Tony Staffieri also said that the economics of the deal aren't dependent on Rogers acquiring Shaw’s wireless assets: “This deal pays for itself largely on the back of the cable synergies, which are significant." — Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Tim Forster at tforster@thewirereport.ca

Concerned about Rogers-Shaw deal: Cogeco’s Jetté

News | March 23, 2021

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Concerned about Rogers-Shaw deal: Cogeco’s Jetté

News | March 23, 2021

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