Rogers and Shaw now have until Feb. 17 to finalize their $26 billion merger.
In a joint statement from Rogers, Shaw and Quebecor issued Monday morning, the companies said the deadline for closing the proposed deal, as well as the subsequent sale of Freedom Mobile to Videotron, had been extended as they await approval from Minister of Innovation, Science and Industry François-Philippe Champagne.
Minister Champagne’s approval is the final hurdle the companies require to close the deal, which was first proposed nearly two years ago and has faced intense scrutiny from regulators into potential impacts it could have on broadcasting and telcom in Canada, particularly when it comes to competition and prices within the wireless sector.
The companies had previously said that the deal would be at risk of falling apart should it not be approved by Jan. 31, when Videotron’s financing to acquire Freedom was set to expire.
The extension came after the House of Commons industry and technology committee met last week to put new questions to company executives, alongside academic experts and critics of the deal.
During questions, Rogers CEO Tony Staffieri pointed to the rigorous regulatory process the companies have gone through over the last two years, saying it has been found to meet standards of competition rules. Representatives from both companies continued to tout the benefits they see for Canadians as a result of the deal, and also said the opposition put up by competitors like Bell and Telus is evidence of competitive benefits for the sector. Quebecor president and CEO Pierre Karl Péladeau and Shaw president Paul McAleese painted criticisms of the merger as efforts by their competitors to undermine the deal.
The committee previously recommended against letting the merger close after it first held hearings in early 2022, prior to the proposed divesture of Freedom Mobile. Its findings are non-binding, and the final approval is up to Minister Champage, though it can make recommendations regarding his decision.
Minister Champagne has said he would take his time to render his final decision, though he has previously said he would require certain conditions, such as Videotron maintaining Freedom’s wireless licenses for ten years and bringing prices across Canada in line with what it charges in Quebec.
However, one issue raised during the committee hearing by Liberal MP Nathaniel Erskine-Smith was whether or not Champagne’s criteria would be enforceable. Jennifer Quaid, a University of Ottawa law professor, raised concerns about the rigorousness of the review process and whether the right expertise was represented at the Competition Tribunal. Experts also said the regulatory process around the deal highlighted the need to change Canada’s competition laws (a review of the Competition Act is set to begin in late February).
