Rogers Sells Freedom Mobile to Quebecor for $2.85B, Rejects Globalive's $3.75B Offer!
"Rogers Communications Inc. says it will sell Freedom Mobile Inc. to Quebecor Inc. for $2.85 billion in a deal it hopes will appease the concerns of federal regulators about its proposed takeover of Shaw Communications.
The Competition Bureau has been seeking to block the Shaw merger over concerns it would substantially prevent or lessen competition in wireless services.
Rogers, Shaw and Quebecor say in a release Friday that they believe their agreement would effectively address those concerns and ensure the presence of a strong and sustainable fourth wireless carrier across Canada.
Anthony Lacavera confirmed earlier on Friday that Globalive Capital took its $3.75-billion offer to buy Freedom Mobile directly to Shaw, in a move he hopes might convince Shaw to let the clock run out on its tie-up with Rogers." - read more on BNN here and even more on BNN here
Breaking Thoughts: The drama continues between Rogers-Shaw, Quebecor, Globalalive and the federal regulators in getting this merger across the finish line.
Rogers has offered $40.50 for shares of Shaw (TSX: SRJ.B), yet due to those issues Shaw has traded as low as $33.42 per share, far below the offer price (meaning investors feel uncertain about the deal).
Regulators won't allow Rogers to keep Shaw's Freedom Mobile, so finding a suitor is key. Quebecor's offer being accepted far below Globalalive's, is a clear slap in the face of consumers. Rogers seems to be hoping that Quebecor "plays ball" - keeping prices high for Canadians (otherwise why accept $900M less?).
While Tony Lacavera, CEO of Globalive, is seeking to create Canada's first "pure-play" wireless company and aggressively compete for customers. Consumers would likely be best off if Globalive is successful at the end of the day, while investors of Shaw simply need a sale so that the acquisition goes through at $40.50 (capturing the difference from the current lower price). Investors in Rogers (TSX:RCI.B), perhaps, have the most to worry about; from a costly unsuccessful acquisition, to increased competition, to a failed acquisition - a lot can go wrong with this move.
Crypto (Bitcoin) Tanks Then Recovers as More Projects Face Risks
"Investors exited bitcoin (BTC) positions worth a record $7.3 billion over the past few days, amounting to the biggest U.S. dollar denominated losses in the asset’s history, data from analytics firm Glassnode shows.
Approximately 555,000 BTC have changed hands between prices of $18,000 and $23,000, a strong support and resistance level respectively for the asset ranged over the past few days, the firm said. Losses ranged between $1.5 billion and $2 billion each day, data shows.
Meanwhile, Glassnode analysts said data at current price levels suggested a market bottom. “We can see that as prices hit the $17,000 lows [Sunday], just 49% of the $BTC supply was in profit,” the firm said in a tweet citing its Percent Supply in Profit tool.
“Historical bear markets have bottomed and consolidated with between 40% and 50% of supply in profit,” Glassnode said." - read more on Coindesk here
Breaking Thoughts: Months of volatility from collapsing/frozen DeFi/exchanges in the crypto ecosystem have reeked havoc on the values of all coins, including "bluechips" such as Bitcoin (BTC) and Ethereum (ETH).
As more fears build around stable coins, the exchanges that rely on them, and DeFi protocols freezing accounts/transfers; the crypto selloff remains in full swing. Bitcoin hit a low of ~$17,800 and is now back above $20,000 a far cry from its peak of nearly $68,000.
While many leveraged exchanges, DeFi protocals, and individual projects may not survive in the short run; it doesn't change the long term trends towards adoption and integration of crypto into the global economy. As long as connected computers exist, people will be able to run opensource blockchain software to transmit value & data.
Major Earnings This Week
Tuesday June 21:
La-Z-Boy (LZB): Expected Q4 earnings of $0.92 per share
Progressive (PGR): Expected Q2 earnings of $0.96 per share
Thursday June 23:
Accenture (ACN): Expected Q3 earnings of $2.85 per share
BlackBerry (BB): Expected Q1 earnings of $-0.05 per share
FactSet Research (FDS): Expected Q3 earnings of $3.23 per share
FedEx (FDX): Expected Q4 earnings of $6.87 per share
Major IPOs Expected This Week
None
See you next week!
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The Market News Reel for this week! Get the most important market news & updates for the week ahead! Major headlines, excerpts from news sources are shown above. "Breaking Thoughts" section is purely our opinion.