The board of Rogers Communications Inc. has voted to remove Edward Rogers as chairman, the company said Thursday, amid a dispute between family members of late founder Ted Rogers that one of Canada’s largest telecommunications companies should lead.
Rogers Communications top boss Joe Natale said on Thursday that Edward Rogers had “unequivocal support” of the board after he attempted to replace him with the company’s now former chief financial officer in late September, a move that has left him unaffected by his sisters. and put her at odds with the mother, all of whom said they supported Natale.
“Edward Rogers has been removed from his position of chairman but remains a director,” the company said in a statement.
“This has been a challenging time for the Corporation and I would like to reaffirm our support and full confidence in the management team and the CEO of Rogers Communications on behalf of the majority of the Board,” replaced the Board of Directors John A. Macdonald. Rogers as chairman, said in a statement.
Natale’s remarks were the first since a rare boardroom dispute broke out in the open across Canada’s corporate landscape last month, taking investors and analysts by surprise. The conflict comes as Rogers is trying to boost its position in Canada’s highly concentrated telecommunications market with a C$20 billion ($16.2 billion) takeover bid for smaller rival Shaw Communications.
The deal is attracting scrutiny from several government regulators as to whether it will reduce competition.
Natale was speaking to analysts after the company beat earnings estimates while revenue matched expectations. He told analysts that Thursday’s board meeting was “a very strong, collaborative and thoughtful discussion with all board members” on the future of the business, including the Shaw acquisition.
Speaker Edward Rogers’ unsuccessful bid to replace Natale was opposed by his sister and deputy chairperson Melinda Rogers-Hickson, as the Globe and Mail newspaper reported last week. Chief Financial Officer Tony Stafieri abruptly exited last month.
In documents released with its third-quarter earnings results, the board said it had formed a committee of three directors, including Rogers-Hickson, to “establish clear protocols for interactions between the chair and members of management.”
The document states that the board will also review corporate governance.
Bloomberg News reported Thursday that Edward Rogers was trying to replace five of the company’s board members with people loyal to him. Reuters could not immediately reach the chairman for a comment and Rogers Communications did not comment.
“While the messy boardroom and family discussions in the media continue, Rogers’ Q3 results show meaningful signs of improvement in several key metrics,” analysts at TD Securities said in a post-earnings note.
On Tuesday, Edward Rogers said there was “room for improvement” in the company’s long-term performance, following a report that he was in talks with potential candidates to replace board members.
Rogers added 175,000 customers who pay monthly bills as demand eased pandemic-led travel restrictions, while wireless service revenue rose 3%.
According to Refinitiv data, total revenue for the three months ended September 30 was C$3.67 billion, roughly in line with estimates of C$3.68 billion.
Excluding commodities, Rogers earned C$1.03 per share, compared to an expectation of C$1.02.
Rogers’ shares fell 1.8% on Thursday, compared to a 15.6% rally in BCE Inc. and a nearly 13.5% gain in Telus Corp., bringing their year-over-year gain to 1.6%.
($1 = 1.2327 Canadian Dollar)
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