A Freedom mobile store owned by Shaw Communications in Calgary, on Feb. 2.Todd Korol/The Globe and Mail
A year after Rogers Communications Inc. RCI-B-T announced a blockbuster, $26-billion deal to buy Calgary-based telecom Shaw Communications Inc., SJR-B-T the effort to sell Shaw’s wireless business, Freedom Mobile, is finally under way.
But in order to close the deal, which would combine two of the country’s largest cable systems, Rogers will need to convince Ottawa that Freedom Mobile’s new owner will be able to compete effectively against Canada’s three big wireless carriers.
Toronto-based Rogers has initiated talks with a number of prospective buyers interested in Freedom, according to two people familiar with the discussions. The Globe and Mail is not identifying the individuals because they are not authorized to discuss the matter publicly.
It is unclear how serious the potential buyers are at this stage of the discussions, which are continuing, but there is at least one player who isn’t at the table. Quebecor Inc.’s Videotron Ltd., which has made no secret of its interest in Freedom, is absent from the talks, according to another source whom The Globe is not identifying.
Representatives of Rogers and Quebecor declined to comment.
Earlier this month, Innovation, Science and Industry Minister François-Philippe Champagne made it clear that he won’t allow Rogers to acquire all of Shaw’s wireless licences, as doing so would be incompatible with Ottawa’s desire for competition in the sector. The federal ministry is one of three federal bodies reviewing the takeover; Rogers also requires approvals from the Competition Bureau and the Canadian Radio-television and Telecommunications Commission. Rogers has said it expects the takeover to close by the end of June.
Shaw’s Freedom Mobile, which operates in Alberta, British Columbia and Ontario, has close to two million wireless subscribers, making it the country’s fourth-largest mobile carrier. Critics have said that allowing it to be acquired by Rogers would lead to higher prices for consumers.
Selling it, however, means finding a buyer who will be able to compete in a capital-intensive industry dominated by Rogers, BCE Inc.’s Bell Canada and Telus Corp., said John Lawford, executive director of the Public Interest Advocacy Centre, an Ottawa-based consumer advocacy group.
“This is, I think, the dilemma,” Mr. Lawford said. “The negotiators and the Competition Bureau are sitting there with Innovation, Science and Economic Development Canada thinking, hmm, how is this gonna look?”
Quebecor president and chief executive officer Pierre Karl Péladeau previously said that Videotron is looking to expand outside of its home province of Quebec, either by acquiring Shaw’s wireless business or by becoming a mobile virtual network operator, or MVNO. (The CRTC issued a ruling last year forcing the national wireless carriers and SaskTel to open up their networks to eligible regional players who wish to become MVNOs.)
Last year, Quebecor spent $830-million on licences to use wireless airwaves, with more than half of that investment going into four Canadian provinces outside of its home market: Ontario, Manitoba, Alberta and B.C.
However, Bank of Nova Scotia analyst Jeff Fan recently questioned whether Quebecor has resigned itself to expanding nationally through an MVNO rather than by acquiring Freedom. “That was our impression based on the continued shareholder return, plus the shift in tone in the earnings release and on the call related to national wireless that seemed to focus more on MVNO,” Mr. Fan said in a research note. “However, when asked, [Mr. Péladeau] on the call noted that acquiring Freedom from the Rogers-Shaw (as part of the potential remedy divestiture) is still a consideration,” he added.
One option, according to Mr. Lawford, would be to split up the assets – which include customer accounts, wireless licences, cellphone towers and stores – between regional telecoms such as Quebecor, rural internet provider Xplornet Communications Inc., which is owned by New York-based infrastructure investment firm Stonepeak Infrastructure Partners, Cogeco Communications Inc. and Bragg Communications Inc.’s Eastlink.
“You can try to do the four-players-in-each-market thing for a while,” Mr. Lawford said in an interview. “They could kind of stumble along for two, three, four years, and then I presume they would just all get bought out again.”
Cogeco has long said it would like to be able to offer wireless services to its existing customers, and CEO Philippe Jetté has left the door open to picking up Shaw’s wireless assets in Ontario. However, Mr. Jetté has made it clear his company is not interested in expanding into Western Canada, where it has no cable network to leverage.
“All the companies that tried to set up a mobile-only operation failed – all of them,” Mr. Jetté said at Scotiabank’s telecom, media and technology conference last week. “It’s very, extremely difficult to do when you have three very capable MNOs that are doing everything they can to block competition.”
Spokespeople for Xplornet and Eastlink both declined to comment.
The federal government’s quest for a fourth national wireless carrier began more than a decade ago, when Stephen Harper’s Conservative government set aside wireless airwaves for new entrants during a 2008 auction. Three wireless startups emerged from the auction: Wind Mobile, which was later renamed Freedom; Public Mobile, which was acquired by Telus Corp.; and Mobilicity, which Rogers later bought.
Shaw, which for years had gone back and forth on whether to get into the wireless sector, bought Freedom in 2016 for $1.6-billion. Since then, Calgary-based Shaw has poured more than $1-billion into buying wireless airwaves and upgrading the network, Chima Nkemdirim, vice-president of government relations, told members of Parliament last year during a public hearing into the takeover.
Despite the investments, Freedom is still not producing free cash flow, Mr. Nkemdirim said – demonstrating how difficult it is to compete as the fourth wireless carrier.
The buyer of Freedom Mobile will also need to pour significant funds into deploying 5G. Mr. Fan has previously said that the buyer of Freedom may have to shell out up between $300-million and $1.5-billion by 2025 to roll out fifth-generation wireless services and compete with Canada’s big telecoms.
Executives at rival Bell have spoken publicly about the challenges that a divested Freedom Mobile would likely face. “I don’t see how that fourth player could be as strong a competitor as Freedom Mobile has been in the past,” BCE CEO Mirko Bibic said last week during Morgan Stanley’s technology, media and telecom conference.
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TORONTO – Canada Goose Holdings Inc. says it has signed a deal that will result in the creation of its first eyewear collection.
The deal announced on Thursday by the Toronto-based luxury apparel company comes in the form of an exclusive, long-term global licensing agreement with Marchon Eyewear Inc.
The terms and value of the agreement were not disclosed, but Marchon produces eyewear for brands including Lacoste, Nike, Calvin Klein, Ferragamo, Longchamp and Zeiss.
Marchon plans to roll out both sunglasses and optical wear under the Canada Goose name next spring, starting in North America.
Canada Goose says the eyewear will be sold through optical retailers, department stores, Canada Goose shops and its website.
Canada Goose CEO Dani Reiss told The Canadian Press in August that he envisioned his company eventually expanding into eyewear and luggage.
This report by The Canadian Press was first published Sept. 19, 2024.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
TORONTO – TD Bank Group, which is mired in a money laundering scandal in the U.S., says chief executive Bharat Masrani will retire next year.
Masrani, who will retire officially on April 10, 2025, says the bank’s, “anti-money laundering challenges,” took place on his watch and he takes full responsibility.
The bank named Raymond Chun, TD’s group head, Canadian personal banking, as his successor.
As part of a transition plan, Chun will become chief operating officer on Nov. 1 before taking over the top job when Masrani steps down at the bank’s annual meeting next year.
TD also announced that Riaz Ahmed, group head, wholesale banking and president and CEO of TD Securities, will retire at the end of January 2025.
TD has taken billions in charges related to ongoing U.S. investigations into the failure of its anti-money laundering program.
This report by The Canadian Press was first published Sept. 19, 2024.
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