By Staff
An investor group that includes the Canada Pension Plan Investment Board, the Caisse de dépôt et placement du Québec, the Public Sector Pension Investment Board and the British Columbia Investment Management Corp. are backing Blackstone’s CDN$7B bid to acquire a minor interest in a new Canadian subsidiary of Rogers Communications Inc.
According to a press release, the acquisition will see Blackstone acquire a non-controlling interest in a new Canadian subsidiary of Rogers that will own a minor part of Rogers wireless network. Rogers will maintain full operational control of its network and will include the financial results of the subsidiary in its consolidated financial statements.
Following the transaction, Blackstone will hold a 49.9% equity interest (with a 20% voting interest) in the subsidiary and Rogers will hold a 50.1% equity interest (with an 80% voting interest) in the subsidiary. The agreement also notes that at any time between the eighth and twelfth anniversaries of closing, Rogers will have the right to purchase Blackstone’s interest in the subsidiary.
The subsidiary is expected to distribute up to approximately CDN$0.4 billion annually to Blackstone in the first five years post-closing. Rogers average capital cost through to the end of the period for purchase is expected to be 7.0% per annum.
The investment in a portion of Rogers’ wireless backhaul transport infrastructure will be reported as equity in Rogers’ consolidated financial statements and is expected to be considered an equity investment by Moody’s Investors Services Inc., S&P Global Ratings, a division of S&P Global Inc., and DBRS Ltd.
The transaction is expected to close in the second quarter of 2025.
“BCI is pleased to support Blackstone through partially funding their equity investment in the new Rogers Communications joint venture subsidiary holding backhaul network infrastructure,” said Daniel Garant, BCI’s executive vice-president and global head of public markets, in the release. “Rogers is a longstanding and respected Canadian company, with a strong network of telecommunications infrastructure. Blackstone’s equity investment will ultimately enable Rogers to unlock greater value from their existing assets.”
