Yahoo Finance NDP leader Jagmeet Singh urges industry minister to reject Rogers-Shaw merger
New Democratic Party leader Jagmeet Singh is urging federal industry minister François-Philippe Champagne to reject the proposed merger of Rogers Communications Inc. and Shaw Communications Inc.
In a letter dated Feb. 12, Singh told Champagne that the deal “is expected to make our cell and internet bills more expensive,” citing the Competition Bureau, which failed in several attempts to block the takeover.
The $26-billion merger is now in the hands of Innovation, Science and Economic Development Canada (ISED), led by Champagne, who must approve the transfer of spectrum licences as part of the divestiture of Shaw’s Freedom Mobile in order for the deal to go through.
“Act now in the interests of the millions of Canadians that will ultimately be affected by your decision,” Singh wrote.
The NDP leader claimed Rogers’ takeover of Shaw will also result in “hundreds of workers” losing their jobs, noting that Rogers had said the deal would save $1 billion in “synergies.”
“In addition to higher prices and layoffs, the Rogers-Shaw merger is already leading to less competition, less innovation and less choice for consumers,” Singh added, accusing Rogers’ rivals of buying out independent ISPs in preparation for the merger, including Bell’s recent acquisitions of EBOX and Distributel.
The deal has already received approval from the Competition Tribunal, a decision that was upheld by the Federal Court of Appeals last month. Singh said the hands of the tribunal and the courts “were tied by a weak Competition Act” and urged Champagne to put those decisions aside.
The Tribunal rejected the Bureau’s arguments that combining the two telecom giants would substantially lessen wireless competition, particularly in light of a side deal to sell Shaw’s Freedom Mobile to Quebecor Inc. subsidiary Vidéotron for $2.85 billion, which they said would ensure there would be four strong players in major markets.
On Monday, Champagne reiterated he hasn’t made a decision on the approval, adding that he is not bound by a specific date to do so.
“I will not allow the transfer of Shaw to Rogers — I have already denied that. The application in front of me now is regarding Vidéotron,” he told reporters in Montreal.
The minister had signalled a willingness to approve the sale of Freedom to Quebecor/Vidéotron in October by laying out two conditions he would find acceptable for the transfer of wireless spectrum.
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Vidéotron would have to hold Freedom’s spectrum licences for at least 10 years, and bring competitive wireless offerings to Ontario and Western Canada that mirror those in Quebec, where prices were brought down by around 20 per cent.
“In Canada, the way to lower prices is to have a fourth strong national player, to put pressure on prices, to ensure the best prices for Canadians,” Champagne said, noting that he is currently reviewing the Federal Court of Appeals decision.
With additional reporting from Marisa Coulton
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