As a means to appease regulator’s concerns around competition, Shaw has agreed to sell Freedom Mobile, its main carrier service, to Videotron for C$2.85 billion. Although the deal has been reached, Rogers and Shaw were still unable to satisfy Canada’s Competition Bureau during its recent mediation. When asked about the results of the mediation, the bureau told the publication that it would be inappropriate to comment, given that the matter is before the courts. Now, Videotron wants to have a say in getting the merger approved.
“Through the Divestiture, Videotron will be able to quickly and efficiently expand its operations outside of Quebec and will fulfill the federal government’s longstanding policy objective of fostering the emergence of a fourth national wireless carrier,” the filing read. “In doing so, the Divestiture is not likely to prevent or lessen competition substantially in any market in Canada. Rather, by creating a fourth national facilities-based wireless carrier, the Divestiture will increase competition in the Canadian wireless industry.”
Canada’s Competition Bureau remains steadfast in its position to block the deal. In May, the bureau requested an order and an injunction from the Competition Tribunal to prevent the deal from proceeding. In addition, the bureau had stated that the sale of Freedom Mobile alone would not guarantee approval.
The Competition Bureau has not publicly disclosed the specific issues it wants to see addressed after the failed mediation, but an earlier report by Reuters said Shaw may have to give up Shaw Mobile as well. Shaw mobile is a newly launched carrier service exclusive to Shaw internet subscribers in Alberta and B.C. The service has around 450,000 customers.