Quote:
Originally Posted by Hemi-Cuda
The deal should be rejected on that basis alone, it's ridiculous that they can borrow more than half of the money needed to buyout another company
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Not really.
Given how cheap it is to borrow, they would be dumb not to.
The problem is their overall debt to equity ratio, income, etc.
Anyone looking at the structure of the deal and the position Rogers is currently in, along with the cost of going to 5G knows that the only way they will pay for it is to increase prices significantly across the board.
Best way to do that is to buy out your competition and fortify the position of your triopoly.
From a shareholders perspective and from the perspective of owning the market, pretty smart move by Rogers.
Of course if the government steps in and mandates wholesale access to towers and spectrum, MNVO, greater access to whole rates on the internet level, foreign competition such as Verizon, AT&T, etc....Rogers would be screwed because the price will be driven down, and suddenly their income or profit won't be there to pay off their massive debt load.
Telus & Bell have got to be laughing right now. What a deal for them.
They'll be able to increase prices without needing spend any money.
Crazy.