Butt Dials, Board Schisms, and the BC Supreme Court: Inside the Rogers Communications Board Battle
TORONTO STAR
At Rogers Communications, Canada’s largest telecom company, a rift has split the board of directors apart along with the Rogers family, creating turmoil in the midst of a $26 billion acquisition of Shaw Communications.
The conflict emerged when Edward S. Rogers III, the son of Ted Rogers, founder of the company, attempted to oust CEO Joe Natale, and replace him with Chief Financial Officer Tony Staffieri.
The plot was unearthed when Natale was accidentally butt-dialed by Staffieri during a meeting on September 17, discussing the plan to remove Natale among other executives, as backed by Edward Rogers.
After informing a company director of the scheme, an emergency weekend board meeting was called, in which most board members reaffirmed Joe Natale as CEO. As a result, Mr. Staffieri left the company on the 29th of September.
However, on November 16, Natale was ousted as CEO by Edward Rogers, chair of the board. Staffieri was brought back into the company as interim CEO.
On October 21, Edward Rogers was removed as chairman, with his two sisters and mother voting for his removal. One of his sisters, Martha Rogers tweeted “Ed, what were you thinking?” She accused her brother of never telling the truth and preying on their mother, equating it as elder abuse.
Hours later, Mr. Rogers filed a shareholder’s petition which unseated five board members and replaced them with his own hand-picked candidates. As the chair of the Rogers Family Trust, which owns a large portion of Rogers’ class A shares, Edward Rogers controls 97 per cent of voting shares in the company, allowing him to make certain changes in the company’s structure.
The Rogers board declared Mr. Roger’s version of the board invalid. Regardless, the new board reappointed Edward Rogers as chair, prompting condemnation from his mother and sisters.
Mr. Rogers’ version of the board was affirmed in a BC Supreme Court case, with the presiding judge calling the family drama “Shakepearian.”
With Edward Rogers back in control, the turmoil at Rogers has quieted, but the Rogers’ family will likely be divided for some time.
The feud comes at a delicate time for the company. With Mr. Rogers back in control, the big issue on the table is the Rogers-Shaw acquisition deal.
Rogers has been planning to acquire Shaw Communications since March 15 2021, in a move which consolidates Canada’s already strained telecommunications market. With 90 per cent of Canada’s internet and telephone service being controlled by just four companies, shrinking it to three will make this deal heavily scrutinized by Canadian regulators.
The telecom competitor Telus has said that this merger will “greatly reduce” competition and lower consumer choice. Amongst the power struggle at Rogers, Telus has asked regulators to not permit the deal to take place.