American telecommunications company Altice USA and Canadian telecom firm Rogers Communications will jointly pursue a takeover of rival Canadian telecom Cogeco even after the company’s board and principal investor jointly dismissed the unsolicited offer.
This week, Altice offered to buy the cable, Internet and phone assets of Cogeco for $7.9 billion (CA $10.3 billion). The plan called for Altice to acquire the Cogeco’s American subsidiary Atlantic Broadband while divesting the rest to Rogers.
Rogers owns around one-third of Cogeco’s Canadian operations. A takeover by Altice would allow Rogers to own complete control of the company. Rogers is the biggest provider of cable television and wireless phone service in Canada.
Cogeco operates Atlantic Broadband in the United States, which has around 480,000 broadband subscribers. Rogers would gain another 800,000 Cogeco broadband customers in two Canadian provinces.
Shortly after the plan was introduced on Wednesday, Cogeco’s principal investor Gestion Audem said it was not interested in selling its shares of Cogeco. Gestion Audem is a holding company run by the Audet family who owns a controlling investment in Cogeco, Reuters reported.
On Thursday, Altice said it would continue to discuss the matter with Cogeco and Rogers, signaling an intent to go forward with acquisition talks despite Cogeco’s initial rejection.