In a news release published the morning of August 12th, Rogers, Shaw, and Quebecor said they had signed a definitive agreement for the sale of Freedom Mobile.
According to the companies, the agreement is “substantially consistent” with the terms previously announced in June. The deal will see Shaw and Rogers sell Freedom Mobile to Quebecor subsidiary Vidéotron for $2.85 billion, conditional on regulatory approval of the Rogers-Shaw merger.
In the release, the three companies said they “strongly believe” selling Freedom will provide ” the best opportunity to create a strong fourth national wireless services provider and addresses the concerns raised by the Commissioner of Competition and the Minister of Innovation, Science and Industry, [François-Philippe Champagne,]” over the Rogers-Shaw merger.
Additionally, the release reiterated Quebecor’s past commitement to leverage the combined businesses of Vidéotron and Freedom to launch a national 5G offering with the former’s 3500MHz spectrum holdings.
Along with being conditional on the Rogers-Shaw merger, it’s worth noting that the Freedom sale would also be dependent on clearance under the Competition Act, as well as approval from Minister Champagne.
As for the Rogers-Shaw merger, it has already been approved by Shaw shareholders, the Court of Queen’s Bench of Alberta, and the Canadian Radio-television and Telecommunications Commission (CRTC). However, it remains subject to review by the Competition Tribunal and approval from Minister Champagne.
It’s worth noting that the Commissioner of Competition filed to block the merger in May, which led to the Competition Bureau, Rogers, and Shaw participating in tribunal mediation, although those mediation efforts failed in July.
However, if the Rogers-Shaw merger goes through and Vidéotron acquires Freedom Mobile, that will only resolve one of the multiple competition concerns with the merger. Along with wireless networks (which the Freedom deal would impact), there are concerns about combining Shaw’s internet and broadband services with Rogers. Those concerns have grown following the massive nationwide Rogers network outage on July 8th (dubbed ‘Red Friday’ by some).