Rogers Communications’ (RCI) $20 billion takeover of rival Shaw Communications (SJR) has moved a step closer to completion after a Canadian appeals court rejected the Competition Bureau’s efforts to block the deal on antitrust concerns.
The latest court decision marks the second legal victory for Rogers, which first moved to acquire Shaw Communications nearly two years ago.
This past December, Canada’s Competition Tribunal supported the deal and dismissed a legal challenge from the Competition Bureau. Now, a three-judge panel on the Federal Court of Appeal has dismissed an appeal of that December decision.
The Competition Bureau could now appeal the case to the Supreme Court of Canada, though legal experts say that is unlikely to happen.
The last remaining step is for the federal Industry Minister to approve Rogers’ purchase of Shaw Communications. Rogers has said that it hopes to close the transaction by the end of this month (January).
A House of Commons industry committee is scheduled to begin public hearings into the merger in the coming days. Last March, the committee said the deal “should not proceed” but its recommendations are not binding.
Consumer groups have raised concerns about the Rogers-Shaw deal, saying it will further erode competition in Canada’s wireless sector and likely lead to higher prices.
Rogers’ stock rose 3.1% on news of the court’s decision. Shaw Communications’ stock gained 2.8%.
Rogers’ stock has risen 8% in the last year to trade at $66 a share. Shaw Communications’ stock has gained 6% over the past 12 months to reach $39.50 per share.
