Roger Communications and Shaw merger plans ahead of competition hearing

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The Competition Bureau launched a lawsuit Monday against the $26 billion merger of telecoms giants Rogers Communications Inc. and Shaw Communications Inc. He said he could not fully offset the decline in competition.

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John Tyhurst, an attorney representing the competition watchdog in a three-member court, said the sale of Freedom Mobile to Quebecor’s Videotron subsidiary would make Rogers both a supplier and a competitor to Videotron. He said it included a deal that spanned decades. He has too much control over the operations of the Montreal-based company.

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“This is more than just a hypothesis,” Tyhurst said, referring to existing litigation between the two companies over network-sharing agreements. About a year ago, Videotron sued Rogers for his $850 million, claiming breach of contract and “bad faith” negotiations over Quebec’s sharing network.

Tyhurst said the proposed sale of Freedom and the entire merger should be dismissed by the competition court.

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The judge overseeing the trial made preparations before starting discussions on Monday by telling businesses and the Competition Bureau what they wanted to hear during the four-week proceedings.

Justice Crampton said the three-member competition court panel also wants to explain to the competition watchdog the “pro-competitive effects” of the proposed undisputed merger. Other questions are also sought to be answered, such as why Vidéotron chose not to purchase Shaw Wireless separate from Freedom, and whether there will be replacement purchasers for Shaw. The Panel would like to hear about arrangements for transferring radio spectrum between

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Shaw’s attorney, Kent Thomson, discusses the Rogers-Shaw merger and Freedom Mobile to Videotron.

“Now is the time to reframe the discussion,” Thomson said following the opening discussion from the Competition Bureau. Much of that discussion took place behind closed doors because it was a discussion of confidential company information. said.

He said the competition watchdog bases its claims on blocking the original Rogers Show deal without the sale of Freedom Mobile, saying its claims are “because they are disconnected from market realities. , there is no benefit,” he said.

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Thomson argued that if the deal were blocked, the “sole winner” would be telecom rivals Telus Corp. and BCE Inc.’s Bell.

He later accused Telus of proceeding “hand in hand” with the competition commission because the Vancouver-based telecom company could benefit if the Rogers-Shaw merger was blocked.

According to Thomson, Shaw, which became a wireless player after acquiring Wind Mobile in 2016, is far behind rival Telus, with limited capital and a “competitor” between fledgling businesses and incumbent wireline businesses. They were forced to “balance the needs to

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As a result, Telus has replaced Shaw as the leading broadband internet provider in Western Canada. Thomson argued that if Rogers was allowed to own those wired assets, larger companies with more established wireless businesses would be able to compete “on an equal footing” with Tellus.

“Rogers will be able to whack Tellus in ways the show couldn’t,” said Thomson.

When it came to lawsuits against the merger, Thomson claimed the competition commission was “playing with the numbers.” It also includes lumping the post-acquisition wireless market share of Rogers, Freedom and Shaw, despite Videotron acquiring Freedom.

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