Canada’s Rogers extends Shaw deal deadline, flags hit from outage
2022.07.27 16:30
FILE PHOTO: The Rogers Building, the green-topped corporate campus of Canadian media conglomerate Rogers Communications is seen in downtown Toronto, Ontario, Canada July 9, 2022. REUTERS/Chris Helgren/File Photo
(Reuters) -Rogers Communications Inc delayed the deadline for its C$20 billion ($15.56 billion) buyout of rival Shaw Communications (NYSE:SJR) and said it would take a hit due to an outage that impacted millions of customers earlier this month.
The purchase of Shaw has been in the crosshairs of Canada’s antitrust agency, which said last week it needs more time to examine the concession offered to allay competition concerns over the deal.
Rogers (NYSE:ROG) said on Wednesday it has extended the deal deadline to Dec. 31, with an option to delay to end-January.
The Canadian telecom giant has come under increased pressure since the outage on July 8 that paralyzed the country’s banking and emergency services for nearly 19 hours.
The company expects to record C$150 million in costs in the third quarter as it credits customers with the equivalent of five days service. The figure was lower than an estimate of $175 million from J.P. Morgan and TD Securities.
For the three months ended June 30, the company reported a profit and revenue that were better than market expectations, thanks to a jump in wireless subscribers and strong demand for its internet services.
Rogers added 122,000 monthly bill paying wireless subscribers in the second quarter, compared with 66,000 net additions in the previous three months, as its efforts to expand 5G coverage helped attract more customers.
Its cable unit — which includes internet, phone and cloud-based services — posted a 3% rise in revenue.
Total revenue rose to C$3.87 billion, compared with the C$3.8 billion expected by analysts, according to Refinitiv IBES data. Adjusted net income was 86 Canadian cents per share, higher than estimates of 85 Canadian cents.
($1 = 1.2852 Canadian dollars)
