Quebecor announced Friday night that it has acquired telecommunications company Freedom Mobile, which will enable its subsidiary Videotron to develop cellphone service in Ontario and western Canada.
The amount of the acquisition completed with Rogers Communications and Shaw Communication is estimated at $2.85 billion, according to a joint press release from the three companies.
This acquisition, subject to approval by the competent authorities, should allow the creation of a fourth national player in the field of telecommunications services.
This is a “defining moment” in the history of competition in the mobile phone sector, according to Quebecor’s President and CEO, Pierre Karl Péladeau.
“We have always been convinced that healthy competition in mobile communications is only possible if a player comes onto the market that has already proven itself. This is a value-added transaction for all consumers and for the Canadian economy,” said the Quebecor boss.
The transaction “also encompasses a long-term initiative by Shaw and Rogers to provide data services (including via backhaul and backbone) and roaming services to Quebecor,” the companies said.
Shaw-owned Freedom Mobile had to be sold because the Competition Bureau of Canada blocked Rogers’ acquisition of Shaw last May.
“Our agreement with Quebecor to divest Freedom is a critical step in completing our proposed merger with Shaw, as we strongly believe the latter will meet the Canadian government’s goal of having a fourth wireless service provider that is strong and enduring is Wire,” said Tony Staffieri, President and CEO of Rogers, in a press release.
Rogers Chairman of the Board, Edward Rogers, also underscored the importance of this transaction.
“This is an all-Canadian solution that will benefit all Canadians by increasing competition and choice, delivering next-generation telecommunications services and unlocking the transformative advantages of Rogers and Shaw,” he said.
Quebecor had been looking for a way to develop the western Canadian market for years after winning spectrum licenses in the last auction organized by Innovation, Science and Economic Development Canada.