Competition Bureau to Pay $13M to Telecom Giants After Failed Merger Block
In a significant ruling, Canada’s merger court has directed the Competition Bureau to compensate Rogers Communications (TSX: RCI.B) and Shaw Communications Inc. (TSX: SJR) to the tune of $13 million. This decision arises from a protracted legal wrangle where the Competition Bureau tried— albeit unsuccessfully, to halt the telecom giants’ controversial $20-billion merger.
Dated August 28, the Competition Tribunal’s judgment explicitly called out Commissioner of Competition Matthew Boswell’s tactics to obstruct the merger as “unreasonable.” The two companies, Rogers and Shaw, expressed frustration with Boswell’s conduct during the legal battle, arguing that he opted for an unduly adversarial approach, thereby inflating the costs they had to bear.
The backdrop to this drama was the vigorous opposition the merger received from Canada’s antitrust regulator. The merger was a significant point of contention because of fears that it would curtail competition in Canada’s telecom sector, a country where consumers grapple with some of the highest wireless bills globally.
Nevertheless, in March, the green light was given to Rogers’s acquisition of Shaw Communications. This approval came with stringent conditions: Rogers committed to facing financial penalties if they reversed promises to generate new employment opportunities and invest in network expansion.
Information for this briefing was found via Reuters. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
