By IIya Banares Bloomberg
- 5G license sale raises $7.2 billion, far above expectations
- Quebecor spends C$830 million, hints at national ambition
Rogers committed C$3.3 billion in the government’s spectrum auction. The company is in the midst of trying to buy rival Shaw Communications Inc. for about $16 billion, a deal that faces potential obstacles from antitrust regulators because it would merge the largest and fourth-largest wireless companies in Canada.
Montreal-based Quebecor Inc., led by Chief Executive Officer Pierre Karl Peladeau, spent C$830 million in the auction, buying licenses in parts of western Canada and Ontario where it doesn’t compete today. Peladeau has expressed an interest in expanding services and taking up the mantle of Canada’s fourth player — and possibly buying Shaw’s Freedom Mobile unit if regulators force Rogers to sell it.
Although the spectrum price tag is negative in the near-term for Rogers’ stock, “the path to regulatory approval for the Rogers-Shaw transaction has become clearer” given “Quebecor’s unexpected ability to acquire set-aside spectrum outside of its existing cable and wireless footprint,” RBC Capital Markets analyst Drew McReynolds said in a note to investors.
Shaw shares have remained about 10% below the C$40.50 price offered by Rogers. Shaw rose 0.3% to C$36.41 at 9:38 a.m. in Toronto on Friday. Rogers and Quebecor each dropped 0.1%.