Buying Freedom Mobile from Rogers would transform Montreal-based Quebecor into a national wireless platform
Late on Friday, Rogers announced plans to sell Shaw’s Freedom Mobile division – Canada’s fourth-largest wireless carrier, with 1.7 million customers – to Quebecor. The sale would transform the Montreal-based company, which has 22 per cent of Quebec’s wireless market, into a national wireless platform, with customers in Ontario, Alberta and B.C.
Mr. Staffieri said in an e-mail that Rogers has “worked very hard to find a new owner for Freedom that we believe meets the requirements that the government and regulators have laid out to promote competition and affordability in wireless.” “We view Quebecor as the most likely buyer to satisfy the Competition Bureau and believe that the agreement signals that Rogers is committed to closing the Shaw transaction,” analysts at CIBC said in a report on Saturday.
Shaw Mobile generates about $100-million in annual revenue. If regulators allow Rogers to hold on to the business, Mr. Staffieri told analysts, the company will be better positioned to pay down around $19-billion worth of acquisition-related debt and maintain an investment-grade credit rating. Over the past two weeks, Quebecor executives pushed aggressively to strike a deal on concerns that Rogers was prepared to commit to a sale to Xplornet, which is based in New Brunswick, and take that transaction to the federal Competition Tribunal, according to two sources familiar with the process. The Globe is not naming the sources because they were not permitted to speak for Quebecor.
“Rogers has shopped this deal to a succession of billionaire friends and friendly parties who won’t compete with them and are willing to sell Freedom back to them at any time,” Mr. Lacavera said in an e-mail Saturday. Globalive Capital founded Freedom Mobile in 2008, formerly called Wind Mobile, and sold it to Shaw eight years later.
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