(Bloomberg) — Canada’s most dramatic corporate showdown in years heads to a Vancouver courtroom Monday as Edward Rogers asks a judge to validate his move to stack the board of Rogers Communications Inc. with his allies.
The company says his new board is illegitimate and has joined with Edward Rogers’s mother, Loretta Rogers, and two of his sisters, Melinda Rogers-Hixon and Martha Rogers, to fight his effort to solidify control.
It’s a case that has laid bare the tensions and squabbles of one of Canada’s richest families, worth about $10 billion according to the Bloomberg Billionaires Index.
Most of that wealth comes from a controlling stake in Rogers Communications. It’s Canada’s largest wireless company with more than 11 million customers and has also extensive holdings in cable and internet service, TV broadcasting, radio and sports, including the country’s only Major League Baseball team.
The public company is controlled by a family-owned trust that has about 97% of the voting shares. Edward Rogers says that as chair of that trust, he controls the votes and can choose the directors on his own — and submitted a shareholder resolution to do so on Oct. 22.
His petition seeks an order from the Supreme Court of British Columbia to legitimize that move. The hearing begins at 10 a.m. local time (1 p.m. in New York).
Rogers vs. Rogers Feud Goes to Court: What You Need to Know
Loretta Rogers has called her only son’s actions “unconscionable” and says he circumvented a commitment enshrined by her late husband, founder Ted Rogers, to settle such disputes with a shareholder vote.
The family fight has been escalating since September, when Edward Rogers attempted to oust Chief Executive Officer Joe Natale, citing concerns about performance and his ability to lead the company through a $16 billion takeover of Shaw Communications Inc., a deal that will transform the company if it is approved by regulators next year.
His plan was to install Chief Financial Officer Tony Staffieri in the top job. Instead, Edward Rogers’s family members joined five independent directors to block the change and fire Staffieri on Sept. 29.
About three weeks later, the board stripped Edward Rogers of his role as chairman and gave it to lead independent director John MacDonald, a former AT&T executive.
That night, Edward Rogers ordered letters mailed to all Rogers Communications’ Class A voting shareholders proposing a written resolution to replace the five directors who’d opposed him. By signing it himself the next day, “it took immediate effect as it was executed by holders of over 97% of the Class A shares,” according to a letter his lawyers sent to the company after the fact.
A meeting of the “new board” took place on Oct. 24 and named him chairman. The company says the meeting was invalid. So for the past week, one of Canada’s largest public companies has had two different men claiming to be chairman, and two different groups claiming to represent the 14-person board.
Justice Shelley Fitzpatrick of the B.C. Supreme Court will decide which side is right.
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