Rogers and Shaw Put the Merger Deal on Hold till Antitrust Issue Is Sorted Out

    Shaw Communications Inc. and Rogers Communications Inc. have agreed not to take their C$20 billion (15.8 billion dollars) deal forward until the antitrust problem is resolved. They said that both the companies are working to negotiate the Canadian Authority’s concerns and find a solution. 

    The temporary halt of the deal

    As per Bloomberg News, both the companies have agreed on a temporary halt to completing the merger process. The possible scenario of closing the deal and then engaging in a long-drawn battle with the competition Bureau of Canada is over for the time being now.

    The options with Rogers and Shaw are that they either negotiate a settlement with the competition bureau or defeat them in an expedited legal hearing at the competition tribunal. This board is similar to a court and takes up antitrust cases. 

    Roger and Shaw said on Monday in a news release that the party’s side deals with the competition bureau will allow them to address the commissioner’s concern regarding the deal and reach a settlement. 

    Rogers Communications Inc, which is based out of Toronto, has been trying to buy out Shaw Communications at C$40.50 in what would have been the biggest merger deal in the history of Canada. Rogers attempted to address the antitrust problem by selling the Freedom Mobile Division of Shaw to another suitable buyer. Still, the bureau argued that it was not enough to maintain competition. 

    The Competition Bureau, in a statement, said that Rogers would not enforce any condition in its agreement with Shaw or any other agreement in connection with the merger that will limit the ability of Shaws to maintain, operate and expand its wireless business. 

    In early May, the antitrust agency filed a case to block the proposed merger, saying they were worried that the consumers would have to pay more after the deal. 

    The regulator said that removing Shaws as a competitor by acquiring it will threaten whatever progress was made to introduce more players in the already concentrated wireless service market. About 87% of the Canadian Subscribers are controlled by TELUS Corp, Rogers Communications Inc., and BCE Inc.



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