Two members of the billionaire family that controls Rogers Communications Inc. are suing the company, saying they have been frozen out of the board and prevented from accessing information, sparking a bitter power struggle within one of Canada’s richest families. It’s reignited.
In a letter included in a court filing, Melinda Rogers-Hixson said she was the target of a “personal vendetta” by her brother, Rogers chairman Edward Rogers. Rogers-Hixson’s Sept. 20 letter to CEO Tony Stafieri said the Rogers brothers were close to reaching an agreement to resolve long-standing differences, but Edward Rogers It is said that the agreement was broken.
The court complaint was filed by Rogers-Hickson and her sister Martha Rogers, who claim the company has been “oppressive” towards them.
Documents show emotional wounds remain unhealed for a prominent Toronto family. Rogers Communications is the nation’s largest wireless provider and owner of a cable television empire, the Toronto Blue Jays baseball team, and other media and sports assets. The family’s controlling stake in the public company is worth nearly $8 billion (US$5.9 billion), according to calculations based on the company’s filings for its 2023 annual general meeting.
Rogers’ stock widened its losses on news of the lawsuit, dropping 2.2 per cent to close at $53.07 in Toronto. It has fallen 16% this year.
The children of the late Ted Rogers frequently fought each other, raising investor concerns about the company’s governance and sometimes causing Rogers’ stock price to drop.
That sin was on full display in October 2021, when Edward Rogers publicly fought with his sisters and mother for control of the board and won in court. As a result, five directors of Rogers Communications were fired and replaced by five allies of Edward Rogers. Shortly after, then-CEO Joe Natale was fired and replaced by former CFO Staffieri. Rogers Hixson and Martha Rogers opposed the CEO change.
The families will temporarily put their differences on hold in early 2022 to avoid bad publicity as the company seeks regulatory approval for its acquisition of Shaw Communications Inc., according to a court filing this week. Agreed. The $20 billion deal is the company’s largest ever and one of the largest corporate transactions in Canadian history.
Negotiations break down
As part of that truce, Rogers Hixson and Martha Rogers were suspended from the board’s discussion of the show transaction due to a dispute regarding Rogers Hixson’s personal attorney (whose firm also works for Telus). You agree not to participate or receive such materials. Rivals between Rogers and Shaw.
The acquisition of Shaw was finalized on April 3 of this year, and the Rogers brothers held discussions “with the aim of resolving all issues between us,” Rogers-Hickson said in an affidavit. mentioned in. “We were hopeful that all issues could be resolved without any negative publicity being spread.” But those talks broke down last month, she said.
Discussions include the possibility that members of the Rogers family may sell their stake in Rogers Communications, leave their roles in the company, or leave the family trust that controls substantially all of Rogers Communications’ voting stock. It is not clear from court filings whether that was the case. Public company.
“This matter should be resolved privately,” Sarah Schmidt, a spokeswoman for Rogers Communications, said in an email. “We have demonstrated that we will not be distracted by these actions. We have significant momentum in the market, the merger is proceeding ahead of schedule, and we have demonstrated that we will not be distracted by these actions. We remain very focused on doing the right thing.”
still excluded
Rogers-Hixson and Martha Rogers said in a written statement that they are still excluded from some board and committee meetings and are being given redacted board documents.
“I cannot properly perform my duties as a director if the information provided to other directors is not provided to me,” Rogers-Hickson said in the affidavit. The two sisters are seeking a judge’s order forcing the company to share information and allowing them to fully attend all board meetings, not just their own board committees.
Schmidt said Rogers took “reasonable steps” to protect company information from competitors. She added that Rogers-Hixson and Martha Rogers could have resolved the matter by choosing another attorney, but “they did not do that.”
The court filing also alleges Rogers-Hixson’s role as a director of Maple Leaf Sports & Entertainment, which owns Toronto’s professional hockey and basketball teams and in which Rogers Communications is a large minority investor. This suggests that he was chased.
Rogers’ Corporate Governance Committee is conducting an investigation into events that occurred in 2021, according to the documents. According to a letter to Rogers-Hixson that was attached to the court, the committee said that Rogers-Hixson, former CEO Natale, three other former executives, five ousted directors, Martha Rogers, journalists and others requested a copy of “all communications” between them. filing.
“The investigation is intended to inform decisions that may be made regarding your status as a director of RCI,” said Robert Gemmell, a former Citigroup Inc. banker and Rogers lead director. The signed letter states:
The company is controlled by a family trust, but it is structured in a way that gives significant power to the trust’s chairman, in this case Edward Rogers, the only son of the late founder Ted Rogers. That’s why he was able to restructure the board in 2021, over the objections of his family.
Family relations have become even more complicated in recent months due to the deaths of three key insiders. Loretta Rogers, mother of Martha, Melinda, Edward, and Lisa Rogers, passed away in June 2022. Alan Horn and Phil Lind, two long-time executives on the Rogers board and collaborators with Edward Rogers, passed away this year.
