Analyst Adam Shine said Shaw’s wireless profits are on the upswing, but weakness in wireline operations dragged on earnings before interest, taxes, depreciation and amortization in the second quarter, reported Wednesday.
“While the annualized potential return still looks interesting, we opted to reduce our rating with the stock above $39 and June fast approaching,” Shine wrote, referring to the intended closing of the acquisition by Rogers.approved the merger of the companies’ broadcast assets last month, but the combination of Rogers and Shaw still requires approval from the Competition Bureau as well as Innovation, Science and Economic Development Canada.
The Competition Bureau also has powers to force remedies including divestitures and infrastructure-sharing arrangements to assist regional players as they build or upgrade networks. In 2017, the Bureau concluded that mobile wireless prices were higher in regions where established players Bell, Telus Corp. and Rogers do not face competition from a strong regional competitor that could disrupt the effects of co-ordination among the incumbents., with financial backers, is in the running to buy Shaw’s Freedom assets, which analysts say could fetch more than $3.75 billion.
There are also reports that New Brunswick-based rural internet service and mobile network operator Xplornet Communications, controlled by New York private equity firm Stonepeak Infrastructure Partners, is interested. Quebecor Inc., which has been public about a desire to become a larger force in wireless operations outside the province of Quebec, is also understood to be interested.Article content