Canada’s antitrust watchdog plans to appeal a court ruling that gave approval to Rogers Communications Inc.’s takeover of a rival, a last-ditch effort to halt one of the country’s biggest-ever corporate mergers.
(Bloomberg) — Canada’s antitrust watchdog plans to appeal a court ruling that gave approval to Rogers Communications Inc.’s takeover of a rival, a last-ditch effort to halt one of the country’s biggest-ever corporate mergers.
Competition Commissioner Matthew Boswell will appeal the decision and is applying for an injunction to prevent Rogers from closing the C$20 billion ($14.8 billion) acquisition of Shaw Communications Inc., the two companies said Friday. The companies have a deadline of Jan. 31 to close their transaction and a related one with another cable and wireless company, Quebecor Inc.
Boswell’s decision to apply to the Federal Court of Appeal doesn’t automatically mean the deal will be delayed. The court has to agree to hear the appeal first and it will be up to the antitrust watchdog to prove that the Competition Tribunal made errors in its legal ruling.
Shaw, which earlier had risen as much as 10%, pared gains on the news but still ended up 9% at C$39.01 in Toronto. Rogers has bid C$40.50 per share.
Rogers shares also dipped after the appeal was announced and ended Friday with a gain of almost 4%, closing at C$63.37.
On Thursday, Canada’s merger court, known as the Competition Tribunal, ruled in favor of Rogers and Shaw by rejecting Boswell’s argument that the deal would harm consumers by causing higher prices and reduced options for consumers. The merger is “not likely to result in materially higher prices” or a decline in service or innovation, the court found.
The ruling was a huge victory for the Canadian companies, concluding a seven-month legal process that has delayed their C$20 billion ($14.8 billion) transaction far past its original closing date of June.
Read more: Rogers, Shaw Soar After Courtroom Win for $14.8 Billion Deal
(Updates with context on appeal, process in third paragraph)
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