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Quebecor, Rogers and Shaw Shares Climb on Freedom Mobile Sale Worth C$2.85 Billion

By Adriano Marchese

 

Shares in Quebecor Inc. rose in early trading Monday after the company said that it has reached an agreement with telecom companies Rogers Communications Inc. and Shaw Communications Inc. to buy Freedom Mobile Inc., worth an enterprise value of 2.85 billion Canadian dollars (US$2.19 billion).

At 1002 ET, Quebecor shares were trading 8.3% higher at C$29.96, while Rogers shares rose 5.5% to C$62.29. Shares in Shaw also rose, climbing 7.6% to C$37.26.

In a joint statement Friday before midnight, the companies said that Quebecor had agreed to buy Freedom on a cash-free, debt-free basis which would expand the Quebec-focused diversified media and telecom company's wireless operations to a national level.

As part of the sale, Quebecor would get all of Freedom Mobile's branded wireless and internet customers as well as its infrastructure, spectrum and retail locations.

The divestiture comes at a time when the combination of Rogers and Shaw, announced in March of last year, is under scrutiny by Canada's competition watchdog and the Minister of Innovation, Science and Industry.

"Our agreement with Quebecor to divest Freedom is a critical step towards completing our proposed merger with Shaw. We strongly believe the divestiture will meet the Government of Canada's objective of a strong and sustainable fourth wireless services provider," Rogers President and Chief Executive Tony Staffieri said.

The transaction is dependent on a number of conditions, including clearance under the Competition Act and the approval of the Innovation, Science and Economic Development Canada, a governmental department.

The deal would close concurrently with the closing of the Rogers-Shaw transaction.

 

Write to Adriano Marchese at adriano.marchese@wsj.com

 

Corrections & Amplifications

This was corrected at 11:00 a.m. ET because the original version incorrectly said the sale of Freedom Mobile was announced late Sunday. It was announced Friday before midnight.

(END) Dow Jones Newswires

June 20, 2022 10:19 ET (14:19 GMT)

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