Rogers Communications (RCI) says it has begun talks with potential buyers for the wireless assets of Shaw Communications (SJR) as it tries to gain regulatory approval for its $16 billion U.S. takeover proposal.
Rogers, Canada’s largest wireless and cable company, may need to sell all or part of Shaw’s wireless business to get regulators to approve the acquisition of Calgary-based Shaw. The companies have said they want to close the deal by June 30 of this year.
Rogers currently has more than 11 million wireless customer accounts, while Shaw has more than two million, making it the fourth biggest player in the Canadian market.
The wireless unit is considered the biggest antitrust concern in the proposed takeover of Shaw by Rogers as there’s no geographic overlap between Rogers and Shaw’s cable networks. If the transaction were to go ahead without the divestment of Shaw’s Freedom Mobile division, consumers in major cities such as Vancouver and Toronto would have only three mobile-phone providers to choose from.
Shaw’s stock rose as high as $38.66 in Toronto trading yesterday (March 14), near a record, as traders bet on the likelihood of success for Rogers’s $40.50-per-share bid. Rogers stock fell 0.2% to $68.59.