Ottawa has approved the multibillion-dollar merger of telecom companies Rogers and Shaw, but with conditions that the feds insists will make the deal good for consumers.
The deal was opposed by consumer advocates and politicians on worries it could lead to higher prices due to an overlap between Rogers and Shaw’s wireless divisions.
As part of the deal, the vast majority of Shaw’s wireless business, Freedom Mobile, will be sold to Quebec-based Videotron. While Freedom Mobile and its more than two million customers will move over to Videotron, Rogers will maintain a much smaller part of Shaw’s wireless business, known as Shaw Mobile, which operates mostly in Alberta and B.C.
Rogers will also be legally bound to make significant investments in the next five years to boost connectivity. Its goals include:
- Creating 3,000 new jobs in Western Canada and maintaining them for a minimum of 10 years after the closing date;
- Establishing a Western headquarters in Calgary and maintaining it for a minimum of 10 years after the closing date;
- Investing $1 billion to expand broadband Internet access, at speeds of at least 50/10 megabits per second, and 5G mobile service in areas where it is not currently available;
- Investing at least $2.5 billion to enhance its 5G network in Western Canada and $3 billion in additional network service expansion projects; and,
- Expanding access to low-cost broadband Internet plans and launching a new low-cost mobile offering for low-income Canadians.
François-Philippe Champagne, minister of innovation, science and industry said if the parties fail to live up to any of their commitments ” our government will use every means in our power to enforce the terms on behalf of Canadians”
Toronto-based Rogers first proposed to take over Calgary-based Shaw in $26 billion price tag on March 15, 2021
The deal is expected to be finalized on April 7, 2023.
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