After Ottawa rejects proposed Rogers-Shaw merger, Peladeau agrees to conditions on Freedom Mobile sale

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MONTREAL — Quebecor Inc. CEO Pierre Karl Peladeau says he intends to accept the conditions laid out by Industry Minister Francois-Philippe Champagne around the sale of wireless carrier Freedom Mobile to Videotron Ltd., which is part of the proposed $26-billion deal between Rogers Communications Inc. and Shaw Communications Inc.

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Peladeau said in a statement Tuesday evening that Quebecor, which owns Videotron, agrees to incorporate the industry minister’s stipulations in a new version of the transaction, paving the way for Freedom’s sale to go through.

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“They are in line with our business philosophy, which has proved highly successful in Quebec, where we have taken a significant market share in a very short span of time,” the statement said.

“We will work to deliver better prices for Canadians in the other provinces and to end the reign of the ‘Big 3’ by promoting competition, the public interest and the digital economy in Canada.”

Shaw’s ownership of Freedom Mobile has widely been seen as the main obstacle to approval of the Rogers-Shaw deal approval. Montreal-based Videotron agreed to buy Freedom Mobile for $2.85 billion earlier this year.

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He said Videotron would have to agree to keep the Freedom wireless licences for at least 10 years.

“We don’t want someone to flip these licences, we want them to be in it for the long term,” he said.

Secondly,Champagne said he would “expect to see” wireless prices in Ontario and Western Canada lowered by about 20 per cent, putting them in line with Videotron’s current Quebec offerings.

Champagne said his conditions for Freedom’s licence transfer were clear, but did not make clear whether a successful sale of Freedom Mobile would mean the Rogers-Shaw deal might still be approved.

“There is a chapter that is closed — Shaw-Rogers, that’s closed. There’s a new chapter opening.”

Champagne’s approval is required for any spectrum licence transfer.

As well as Champagne’s approval, the Rogers-Shaw deal required a green light from the Competition Commissioner and the CRTC.

The Canadian Radio-television and Telecommunications Commission offered its conditional approval for the broadcasting portion of the deal in March.

A mediation is scheduled for later this week between the Competition Commissioner and Rogers and Shaw. The Competition Bureau is attempting to block the merger, saying that the sale of Freedom Mobile does not go far enough to eliminate its concerns that telecom bills would increase amid reduced competition.