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TORONTO (Reuters) – Canada’s competition bureau is expected to ask Rogers (NYSE:ROG) Communications Inc to sell Shaw Communications (NYSE:SJR) Inc’s cellular business to overcome the antitrust concerns presented by Rogers’ C$20 billion ($15.4 billion) acquisition of Shaw, two sources familiar with the matter told Reuters on Thursday.
Canada’s competition bureau has blocked Rogers’ proposed purchase of Shaw on the grounds that the deal will lessen competition in the telecom sector, leading to increased mobile bills for consumers.
As part of the merger remedy, Rogers-Shaw last week agreed to sell Freedom Mobile, the cellular business owned by Shaw, to Montreal-based Quebecor Inc for C$2.85 billion. The bureau has previously said that the sale of Freedom Mobile isn’t sufficient to bolster competition in the Canadian market.
A Rogers spokesperson pointed to documents filed with the Competition Tribunal, where antitrust cases are decided, this month where it has argued that Shaw’s own cellular operation Shaw Mobile has no “sustainable path to grow.”
“The Commissioner has overstated the competitive significance and impact of the Shaw Mobile brand (as distinct from Freedom),” the spokesperson said.
Representatives of Shaw and Quebecor were not available for comments while the competition bureau declined to comment.
($1 = 1.3003 Canadian dollars)
