A fourth major wireless carrier is launched in
Canada
MONTRÉAL and CALGARY, April 3,
2023 /CNW/ - Quebecor Inc. ("Quebecor") and Shaw
Communications Inc. ("Shaw") announced today that the acquisition
of Freedom Mobile Inc. ("Freedom") by Videotron Ltd. ("Videotron"),
a wholly-owned subsidiary of Quebecor, has been completed, creating
the fourth strong, competitive wireless service provider that
Canadian consumers and governmental and regulatory authorities have
been waiting for (the "Freedom Transaction").
With a combined total of more than 3.5 million customers for
mobile services alone and the expertise of nearly 7,500 employees,
Freedom and Videotron have the leverage to further disrupt
Canada's wireless market.
"We are very pleased to be closing the acquisition of Freedom
Mobile today, bringing its Canadian footprint as well as the
expertise and experience of its employees into our fold," said
Pierre Karl Péladeau, President and CEO of Quebecor. "The alliance
of Freedom and Videotron will permanently transform Canada's wireless market for the benefit of
consumers and create a new competitive environment that delivers
innovative products and services at better prices."
Since the beginning of the acquisition process, many hurdles
have been successfully cleared. Videotron and Quebecor have
demonstrated that their customers have enjoyed better rates, better
products and the best customer service, thanks in part to the
massive investments Videotron and Quebecor have made and their
commitment to customer satisfaction.
"Today marks the beginning of a new era for Canadians," Mr.
Péladeau said. "Joining Videotron's track record of success in
Quebec with Freedom's highly
skilled teams will bring our customers the benefit of our combined
expertise and our unwavering customer-centric focus. Finally, we
also want to thank Shaw and Rogers for their ready cooperation
throughout this process, which is so important to Canada's economic future."
"We are incredibly proud of what our team has accomplished in
the past several years to make Freedom Mobile a strong competitor
in British Columbia, Alberta, and Ontario," said Brad
Shaw, Executive Chair and Chief Executive Officer, Shaw. "We
are confident that, with these assets under Quebecor's leadership,
Canadians will continue to benefit from increased wireless
competition, investment and affordability."
Immediate benefits for Canadian
consumers
Determined to lower prices for the benefit of Canadians,
Videotron has promised the Honourable François-Philippe Champagne, Minister of Innovation,
Science and Industry, that it will, among other things:
- Ensure that over a period of ten years, Freedom's plans will be
at least 20% more affordable than the equivalent plans currently
offered by the incumbents in the British
Columbia, Alberta and
Ontario markets;
- Maintain prices for Freedom's existing customers for five
years. Existing Freedom customers will also automatically receive a
10% increase in their local data limit at no additional cost. In
addition, Freedom will participate, within its wireline footprint,
in the Connecting Families initiative available to low-income
Canadian families and seniors, as Videotron already does;
- Invest more than $150 million to
upgrade Freedom's infrastructure, which will, among other things,
enable 90% of its customers to access the 5G network using a
compatible device within two years. Quebecor has also committed to
keeping Freedom's spectrum licences for at least 10 years after
they are transferred.
With the recent acquisition of independent telecom provider
VMedia Inc., Videotron will be able to offer Canadians in
British Columbia, Alberta, Manitoba, and Ontario attractive multi-service bundles
including not only wireless, but also Internet and television
services, within the next few months.
Transaction details
The acquisition was completed on the basis of an enterprise
value of $2.85 billion. Videotron
paid $2.17 billion in cash and
assumed certain debts, primarily lease obligations. The
consideration paid is subject to certain post-closing adjustments.
The cash consideration was financed in part through a new
$2.1 billion secured term credit
facility of Videotron entered into with a syndicate of financial
institutions, consisting of three equal tranches maturing in
October 2024, April 2026 and April
2027.
Settlement between Videotron and
Rogers
Videotron and Rogers have also settled a commercial dispute
related to a shared 4G/LTE network in Québec and the Ottawa area. The companies remain committed to
continuing this agreement and investing in the joint network for
the benefit of their respective customers.
Caution Regarding Forward Looking
Statements
This news release includes "forward-looking statements" within
the meaning of applicable securities laws, including, without
limitation, statements about the completion of the "Freedom
Transaction", the expected continuation of Freedom as a viable
fourth wireless carrier, the anticipated benefits and effects of
the Freedom Transaction, on the commitments made to the Minister of
Innovation, Science and Industry, on the benefits of the Freedom
Transaction for Canadian consumers, on the development of the
Freedom and Videotron networks and the investments that will be
made in them, as well as on the offering of additional products and
services that will be made to Freedom's customers. Forward-looking
information may in some cases be identified by words such as
"will", "anticipates", "believes", "expects", "intends" and similar
expressions suggesting future events or future performance.
We caution that all forward-looking information is inherently
subject to change and uncertainty and that actual results may
differ materially from those expressed or implied by the forward-
looking information. A number of risks, uncertainties and other
factors could cause actual results and events to differ materially
from those expressed or implied in the forward-looking information
or could cause the current objectives, strategies and intentions of
Quebecor to change. Such risks, uncertainties and other factors
include, among others, the outcome and timing of potential
litigation associated with the Freedom Transaction, which could,
among other things, result in changes to the parameters of the
Freedom Transaction; unknown potential liabilities or costs
associated with the Freedom Transaction; the inability to realize
the anticipated benefits of the Freedom transaction in the expected
time frame or at all; Videotron's inability to successfully
integrate Freedom's operations, Videotron's inability to
successfully continue developing its network or Freedom's network,
Videotron's inability to implement its business and operating
strategies successfully and to manage its growth and expansion and
general economic, commercial and political conditions. Accordingly,
we warn investors to exercise caution when considering statements
containing forward-looking information and that it would be
unreasonable to rely on such statements as creating legal rights
regarding the future results or plans of Quebecor. We cannot
guarantee that any forward-looking information will materialize,
and you are cautioned not to place undue reliance on this
forward-looking information. Any forward-looking information
contained in this news release represent expectations as of the
date of this news release and are subject to change after such
date. A comprehensive discussion of other risks that impact
Quebecor can also be found in its public reports and filings, which
are available under its profile, as applicable, at
www.sedar.com.
Forward-looking information is provided herein for the purpose
of giving information about the Freedom Transaction and its
anticipated benefits. Readers are cautioned that such information
may not be appropriate for other purposes.
All forward-looking statements are made pursuant to the "safe
harbour" provisions of the applicable Canadian and United States securities laws. Quebecor is not
under any obligation (and Quebecor expressly disclaims any such
obligation) to update or alter any statements containing
forward-looking information, the factors or assumptions underlying
them, whether as a result of new information, future events or
otherwise, except as required by law. All of the forward-looking
information in this news release is qualified by the cautionary
statements herein.
About Quebecor Inc.
Quebecor, a Canadian leader in telecommunications,
entertainment, news media and culture, is one of the
best–performing integrated communications companies in the
industry. Driven by their determination to deliver the best
possible customer experience, all of Quebecor's subsidiaries and
brands are differentiated by their high–quality, multiplatform,
convergent products and services.
Quebecor (TSX: QBR.A, QBR.B) is headquartered in Québec and
employs nearly 10,000 people in Canada.
A family business founded in 1950, Quebecor is strongly
committed to the community. Every year, it actively supports more
than 400 organizations in the vital fields of culture, health,
education, the environment, and entrepreneurship.
About Shaw Communications
Inc.
Shaw is a leading Canadian connectivity company. The Wireline
division consists of Consumer and Business services. Consumer
serves residential customers with broadband Internet, Shaw Go WiFi,
video and digital phone. Business provides business customers with
Internet, data, WiFi, digital phone, and video services. The
Wireless division provides wireless voice and LTE data
services.
Shaw is traded on the Toronto
and New York stock exchanges and
is included in the S&P/TSX 60 Index (Symbol: TSX - SJR.B, NYSE
- SJR, and TSXV - SJR.A). For more information, please visit
www.shaw.ca.
SOURCE Québecor Média inc.