By Adriano Marchese
Shares of Quebecor Inc. rose in early trading Monday after the company said it had reached an agreement with telecommunications companies Rogers Communications Inc. and Shaw Communications Inc. to buy Freedom Mobile Inc., from a enterprise value of 2.85 billion Canadian dollars (United States). $2.19 billion).
As of 10:02 a.m. ET, shares of Quebecor were trading up 8.3% at C$29.96, while shares of Rogers were up 5.5% at C$62.29. Shares of Shaw also rose, climbing 7.6% to C$37.26.
In a joint statement late Sunday, the companies said Quebecor had agreed to buy Freedom free of cash and debt, which would expand the diversified Quebec media and telecommunications company’s wireless business nationwide.
As part of the sale, Quebecor would obtain all Freedom Mobile-branded wireless and Internet customers as well as its infrastructure, spectrum and outlets.
The divestment comes at a time when the merger of Rogers and Shaw, announced in March last year, is under scrutiny by Canada’s competition watchdog and the innovation minister. , Science and Industry.
“Our agreement with Quebecor to sell Freedom is a crucial step towards the realization of our proposed merger with Shaw. We strongly believe that the divestiture will meet the Government of Canada’s goal of having a strong and sustainable fourth wireless service provider,” said Rogers President and CEO Tony Staffieri. said.
The transaction is subject to a number of conditions, including clearance under the Competition Act and approval from Innovation, Science and Economic Development Canada, a government department.
The deal would be made concurrently with the closing of the Rogers-Shaw transaction.
Write to Adriano Marchese at [email protected]