GLENTEL, the largest independent retailers of wireless in Canada, last month announced plans for Bell to acquire its business for $670 million. GLENTEL owns Wireless Wave, T-Booth and other retail brands. It sells devices and plans from Rogers, Bell, Virgin, Fido, Chatr and SaskTel.
The deal is expected to close by the end of the first quarter of 2015 and will need approvals from the various courts and Competition Bureau, and shareholders. Not one to standby and let this deal easily pass, Rogers has filed an injunction with the Ontario Superior Court of Justice against the sale of GLENTEL to Bell.
Rogers reportedly noted in its filing that since the two companies are already engaged in business, its agreement with GLENTEL requires Rogers’ approval prior to a change of control. GLENTEL stated that Rogers’ application is meritless, and that they are able to complete the transaction.
“For over 25 years, GLENTEL has distributed Rogers mobile products through our Canadian retail stores and we hope to continue to do so. The BCE acquisition does not affect GLENTEL’s agreement with Rogers which will continue to remain in force after the acquisition completes,” said Tom Skidmore, GLENTEL President and CEO.
“Rogers has the right to remove their products from our Canadian stores if they choose or to terminate its agreement with us, but has no right under its agreement to block the acquisition of GLENTEL, which operates in Canada, the United States, Australia and the Philippines. Rogers’ claim is without merit and we will certainly defend against it.”
According to the terms of the deal, if the deal is not closed for “competition approval reasons,” Bell would have to pay GLENTEL a reverse break fee of $33.6 million.
Update: We have now included the complete document that Rogers filed with the Ontario Superior Court of Justice. Rogers noted in an email to us that “We value our relationship with Glentel and they continue to offer our products in their stores. This court case is about protecting our rights – we’re asking the Court to ensure they honour our agreement, which says they required our prior consent to a change in ownership.”
[source] CNW [/source]
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