INTRODUCTION

Rogers and Shaw are Canadian telecommunication company that is mainly

focused on connecting its consumers with the world through its services. Being
world-class and having the connectivity experience, the company has been able
to build its brand for years trying to be the best of the best.

Rogers Communications Inc. is a diversified communications and media

company that operates almost entirely in Canada. Founded in 1960 with a single
FM radio station in Toronto, it is now the country’s largest provider of wireless
services as well as a leading cable company and a major player in broadcasting,
publishing and sports entertainment. Among its many brands are City TV,
Chatelaine magazine and the Toronto Blue Jays. Rogers Communications was
created and built by Edward Samuel (Ted) Rogers Jr., one of the most
successful entrepreneurs Canada has ever produced. The son of anelectronics
and radio pioneer who died young, he was educated at Upper Canada College,
Trinity College at the University of Toronto, and Osgoode Hall Law School.
For most of those years, however, he was more interested in business than his
studies. In 1960, while articling at the Torys law firm in Toronto, Rogers
borrowed $85,000 to buy CHFI, Canada’s first FM radio station, with a partner,
Joel Aldred, a well-known broadcaster of the time. That same year, Rogers and
Aldred teamed up with the Bassett and Eaton families and, following a bidding
process, won the licence for CFTO, the first private television station in
Toronto. CFTO began broadcasting on 1 January 1961. Three years later,
Rogers expanded the reach of his radio business by adding an AM station,
which later became 680 News. While Ted Rogers’s radio and TV stations won
growing audiences in their first few years, they were losing money because of
high costs. By 1967, Rogers recalled later, “I was already up to my ears in
debt.” Looking for larger opportunities, he realized the potential of cable
television, an industry that was still in its infancy. In partnership once again
with the Bassett and Eaton families, he was granted cable TV licences for three
Ontario markets: parts of Toronto, Brampton and Leamington. Rogers had to
borrow more money to finance the construction of a cable network. By 1969,
his radio and cable businesses were $11 million in debt. That year, the newly
formed broadcast regulator, the Canadian Radio-television and
Telecommunications Commission (CRTC), was concerned about concentration
of media ownership and announced it would renew Rogers Cable’s licences
only if the Bassetts and Eatons were not involved. That required Rogers to buy
out their 50 per cent share of the company, which pushed him to the brink of
bankruptcy in 1971. However, Rogers was well positioned to capitalize on the
booming market for cable TV, and the business grew throughout the 1970s,
although debt remained a problem. In 1980, Rogers acquired control of two
bigger cable companies, Canadian Cablesystems and Premier Cablesystems,
catapulting Rogers Cable from its position as the sixth-largest cable company in
Canada to the largest, with 1.3 million subscribers. At the same time, the
company became publicly owned, with its stock trading on the Toronto Stock
Exchange.

In the early 1980s, Rogers expanded into the United States, building and
acquiring cable systems in several states as the industry continued to expand. At
one point, Rogers was th e largest cable company in the world, but its debt load
had ballooned, especially as interest rates were at an all-time high. To help ease
pressure from the banks, Rogers began issuing high-yield bonds (also known as
junk bonds) as an alternative way of raising money to fund the business.
Meanwhile, Ted Rogers was one of the few people who recognized the potential
of cellular, or wireless, telephones, but the company’s board of directors
initially refused to invest in this new and unproven technology. In 1983, he
bought a 25 per cent share in a new partnership, Cantel, which was awarded the
first national licence by the federal government to set up a Canada-wide cellular
telephone network, a project that would cost hundreds of millions of dollars.
Cantel introduced the country’s first cellphone service on 1 July 1985. In 1986,
the newly named Rogers Communications Inc. acquired operational control of
Cantel, and two years later it gained full control, for $600 million. Building a
national cellular network would cost Rogers another $700 million over five
years. In 1989, Rogers Communications sold its US cable operations and
invested the resulting $1 billion profit into its Canadian wireless business and an
ill-fated foray into the long-distance telephone market. Rogers bought a share of
CNCP Telecommunications, later renamed Unitel, which was launched to
compete with Bell Canada in the long-distance phone business, previously a
Bell monopoly. Disagreements arose among the partners, however, and when
Unitel was restructured in 1995, Rogers walked away, abandoning the $500
million it had invested in Unitel.

Another major deal was consummated in 1994 when Rogers made a

hostile bid for Maclean Hunter, a major cable operator and media conglomerate
with radio and TV stations, consumer and trade magazines and the Sun
newspapers. After complicated negotiations, Rogers paid $3.1 billion for
Maclean Hunter, thereby becoming one of Canada’s most important media
companies as well as its preeminent cable and wireless provider. In 1996,
however, it sold the Sunnewspapers ( see Rogers Puts Sun Chain Up for Sale.)
In the late 1990s, Rogers’s wireless operations continued to lose money as it
invested heavily in building its cellular network. Its share price sank as
investors worried that the company might collapse under its $5-billion debt
load. These concerns were eased in 1999 when Microsoft, AT&T and British
Telecom invested a total of $2 billion in Rogers (see Microsoft Buys into
Rogers).
 The deals continued in the new millennium. In 2000, Rogers offered $5
billion to take over Groupe Vidéotron, Québec’s largest cable provider (see
Rogers Buys Vidéotron). Although the bid failed, Rogers gained a $241-million
breakup fee, and in the same year acquired the Toronto Blue Jays and Cable
Atlantic, serving much of Newfoundland (see Rogers Buys Blue Jays). As well,
Rogers and Shaw Communications Inc. exchanged cable assets worth $4 billion
to entrench their respective cable clusters in central and western Canada. (See
also Rogers Enters Phone Wars.)
In 2004, Rogers bought out AT&T’s 33 per cent stake in Rogers Wireless
for $1.8 billion and then paid $1.4 billion to acquire Microcell Solutions, which
provided wireless services under the Fido brand. Ted Rogers called this deal the
biggest success of his career; without it, Rogers Communications would be half
its current size. By the end of 2007, the little broadcasting company that grew
into a cable giant was now primarily a cellular services provider, with wireless
operations accounting for 54 per cent of revenue and 70 per cent of profit. As a
result of wireless growth, Rogers was now on a firmer financial footing and its
shares were considered “investment-grade.” The media side of the business
grew as well in 2007, with the acquisition of five City TV stations.
In 1960, while articling at the Torys law firm in Toronto, Rogers borrowed
$85,000 to buy CHFI, Canada’s first FM radio station, with a partner, Joel
Aldred, a well-known broadcaster of the time. That same year, Rogers and
Aldred teamed up with the Bassett and Eaton families and, following a bidding
process, won the licence for CFTO, the first private television station in
Toronto. CFTO began broadcasting on 1 January 1961. Three years later,
Rogers expanded the reach of his radio business by adding an AM station,
which later became 680 News.

When Ted Rogers died of heart failure on 2 December 2008, at the age of 75,
the company he had founded was one of Canada’s best-known corporations,
with annual revenue of more than $11 billion, more wireless and cable
subscribers than any other company, and a broad assortment of media holdings
from coast to coast. (See Edward Rogers: Obituary.)Although two of his four
children were active in the company as senior executives, the board of directors
went outside the family to replace Rogers as president and chief executive
officer. The board’s choice, Nadir Mohamed, had joined Rogers 2000, when
Ted Rogers hired him from a competing wireless company, Telus. Mohamed
oversaw the explosive growth of the wireless business and played a key role in
the 2004 Fido acquisition.

Rogers Communications was Canada’s 38th largest company in 2017, as

measured by annual revenue. For 2017, it reported total operating revenue of
$14.1 billion and profit of $5.4 billion. Its total assets were worth $28.9 billion,
and it employed approximately 24,500 people.
Its four main operating divisions are Rogers Wireless (58 per cent of revenue in
2017), Rogers Cable (24 per cent), Rogers Media (15 per cent) and Rogers
Business Solutions (3 per cent). The company’s stock is traded as RCI on both
the Toronto and New York Stock Exchanges.

At the end of 2017, Rogers Wireless provided voice and data communications
services to 10.5 million subscribers under the Rogers, Fido and chatr brands
over a network that covered 96 per cent of all Canadians, as well as wireless
roaming around the world. Rogers Cable delivers television, Internet and home
phone services to 4.3 million homes in Ontario, New Brunswick and
Newfoundland. Rogers Media’s television brands include City, OMNI, FX
Canada, Sportsnet and The Shopping Channel. It also operates 55 radio stations
across the country. Its publishing division produces magazines such as
Chatelaine, Maclean’s, L’actualité and Hello! Canada, and its sports
entertainment properties include some of Toronto’s top professional teams.
Rogers Business Solutions works with Rogers Cable to deliver telecom,
networking and data services and solutions to businesses and governments.

On March 15, 2021, Rogers Communications Inc. (“Rogers”) and Shaw

Communications Inc. (“Shaw”) announced that they have reached an agreement
for Rogers to acquire all of Shaw’s issued and outstanding Class A Shares and
Class B Shares in a transaction valued at approximately $26 billion inclusive of
approximately $6 billion of Shaw debt (the “Transaction”). The offer price of
$40.50 per share represents a significant premium for Shaw shareholders;
further details of the transaction are described below. The transaction is not
subject to a financing condition as Rogers has secured committed debt
financing, which it will use along with balance sheet cash and the issuance of
23.6 million shares to the Shaw Family Living Trust.

The combination of Rogers and Shaw builds on the strong legacy of two family-
founded Canadian companies. The combined entity will have the scale, assets
and capabilities needed to deliver unprecedented wireline and wireless
broadband and network investments, innovation and growth in new
telecommunications services, and greater choice for Canadian consumers and
businesses. As part of the transaction, the combined company will invest $2.5
billion in 5G networks over the next five years across Western Canada, which
will enhance competitiveness, offer consumers and businesses more choice and
improved services, help close the digital divide between urban and rural
communities, and deliver significant long-term benefits for businesses and
consumers. This transaction will create Canada’s most robust wholly-owned
national network, and as a result of the combined spectrum holdings and
enhanced capacity, will generate more choice and competition for businesses
and consumers, as well as realizing the full benefits of next generation networks
for Canadians and Canada’s productivity. 
The combination will accelerate the delivery of critical 5G service across
Western Canada, from rural areas to dense cities, more quickly than either
company could achieve on its own. This will be accomplished by bringing
together the expertise and assets of both companies, including Shaw’s existing
cable, fibre, and wireless networks and Rogers’ robust national wireless
network and extensive 5G capabilities. 

Additionally, Rogers will commit to establishing a new $1 billion Rogers Rural

and Indigenous Connectivity Fund dedicated to connecting rural, remote and
Indigenous communities across Western Canada to high-speed Internet and
closing critical connectivity gaps faster for underserved areas. As part of this
fund, Rogers will consult with Indigenous communities to create Indigenous-
owned and operated Internet Service Providers, which would leverage Rogers’
expanded networks and capabilities to create sustainable, local connectivity
solutions.

The combined company is committed to continue offering affordable wireless

plans, with no overage fees, that meet the budgets and needs of Canadians. As
part of this commitment, Rogers will not increase wireless prices for Freedom
Mobile customers for at least three years following the close of the transaction.
In addition, to help individuals and families access affordable Internet services,
Rogers will also expand its Connected for Success program nationally to reach
every Canadian where the combined company offers Internet services. This
first-of-its-kind program is designed to help seniors and low-income Canadians
who receive income assistance access low-cost, high-speed Internet, with
multiple speed options to meet customers’ needs.

The scale created by this combination will enable the level of infrastructure
expansion that is critical to drive growth, attract new consumer and business
customers, and drive technology adoption. Upgrading Canada’s digital
infrastructure and accelerating digitization is critical to diversifying and
strengthening the country’s economy and innovation sector as well as fueling
economic recovery. 

This transaction is expected to generate significant growth and efficiency

opportunities to support the accelerated investment into 5G capabilities and
expanded urban and high-speed rural connectivity in Western Canada.
Anticipated benefits include access to new services and capabilities for Shaw
customers as well as savings opportunities for Rogers, such as reduced
wholesale charges and network costs and the elimination of duplicative
technology and infrastructure associated with greater scale.
REFERENCES

https://www.thecanadianencyclopedia.ca/en/article/rogers-communications
https://www.shaw.ca/corporate/shaw-rogers