Escaping Company Drama A Certain Pleasure Of Working From Home, Creates Boredom Among Reporters

Michael Hedges November 10, 2021 Follow on Twitter

As with every part of post-modern life, drama extends into every opening. Corporate drama is usually kept at a minimum, publicly at least. While investors and stock traders want to know all the lurid stories, executives fight to keep the squabbles out of the public sphere. Naturally, business reporters - minding their main audience - dig for the juicy bits.

The British Columbia (Canada) Supreme Court ruled last week (November 5) that Edward Rogers can name new independent directors of his liking and become, again, chairperson of Rogers Communications. Mr. Rogers is chairperson of the family trust controlling the company. He is the son of company founder Ted Rogers and wanted the board to remove chief executive Joe Natale.

That failed in September after several of Mr. Rogers’ siblings and his mother voted against booting Mr. Natale. After the court decision Loretta Rogers - widow of Ted Rogers and mother of Edward Rogers - warned of “a real prospect of management upheaval and a prolonged period of uncertainty, perhaps at the worst possible time,” reported Financial Post (November 8). Media watchers in Canada and elsewhere began comparing the saga to the TV series Succession and game show Family Feud.

Rogers Communications is mobile telecom operator and financial services company with residual assets in cable TV not to forget holding National Hockey League (NHL) rights. It was founded in 1960 as a radio broadcaster, expanding into television and publishing. The company has exited most all of those other assets over the last two decades. Rogers Communications is publicly traded in Toronto and New York. It is the biggest telecom in Canada.

Wrangling among and between family and company board members, which are entangled, took hold after an agreement was reached in March for the company to acquire Shaw Communications, also a very large telecom operator, centered in western Canada. Shaw was in and out, in and out of broadcasting over the last two decades. When the transaction is approved, now highly expected, Shaw Communications shareholders will receive CAN$20 billion (US$16 billion).

Happiness within the Rogers Communications board, however, was not universal. That appears more related to board power struggles and the company’s overall financial performance than anything to do with the Shaw Communications acquisition. Loretta Rogers and two sisters voted Edward Rogers out as company board chairperson. But he could not be removed as chairperson of Rogers Control Trust, the family trust holding 91% voting rights in the company. That led to Edward Rogers filing a claim with the British Columbia (BC) Supreme Court to adhere to BC provincial law allowing controlling shareholders to dismiss independent directors at their pleasure. The Court said it was OK and Edward Rogers replaced the independent board members and had himself named - renamed - chairperson.

"These family squabbles are an interesting backdrop to this dispute that would be more in keeping with a Shakespearean drama," wrote Justice Shelley Fitzpatrick in her decision. "They have no doubt added a voyeuristic element on the part of many into the lives of a very wealthy Canadian family and this aspect of the dispute has driven some media coverage. At best, they are a distraction.” William Shakespeare’s King Lear (1606) is remembered as particularly nasty.

We expect this kind of drama in, well, France but never in quite polite Canada. There was probably not a big family Thanksgiving Day dinner, October 10. "We are very disappointed with the court's ruling, which represents a black eye for good governance and shareholder rights,” said sister Martha Rogers in a statement (November 6). Earlier Ms Rogers blasted her brother as “a fan of specious claims, like Donald Trump won the (US) election.”

The Canadian Radio-television and Telecommunications Commission (CRTC) will begin hearings on the proposed takeover in two weeks (November 22). Meanwhile, Mr. Natale has kept his job, so far. “It’s just a matter of timing,” opined the Toronto Star (November 9).

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