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TORONTO - Rogers Communications (TSX: RCI.A and RCI.B) (NYSE: RCI), a $14.8 billion telecommunications giant with annual revenues of $14.4 billion, has received approval from the Canadian Radio-television and Telecommunications Commission (CRTC) to acquire Bell’s interest in Toronto Raptors Network Ltd (NBA TV Canada), the company announced Thursday. According to InvestingPro analysis, Rogers currently trades below its Fair Value, suggesting potential upside for investors.
This regulatory approval represents the final step needed for Rogers to expand its ownership in Maple Leaf Sports & Entertainment (MLSE). The company plans to close the C$4.7 billion acquisition in early July, which will make Rogers a 75% owner of MLSE.
"We’re pleased to receive all the necessary approvals to expand our ownership of MLSE," said Tony Staffieri, President and CEO of Rogers, in the press release statement.
Prior to the CRTC decision, Rogers had already secured approvals from multiple sports leagues including the National Hockey League, National Basketball Association, Canadian Football League, Major League Soccer, and the American Hockey League. The company also received clearance from the Competition Bureau. InvestingPro data shows Rogers maintains a GOOD financial health score, with particularly strong metrics in relative value and profitability.
The acquisition, initially announced in September 2024, will significantly increase Rogers’ stake in MLSE, which owns several professional sports teams and entertainment properties in Toronto.
MLSE is a major sports and entertainment organization that controls multiple professional franchises including the Toronto Maple Leafs (NHL), Toronto Raptors (NBA), Toronto FC (MLS), and the Toronto Argonauts (CFL).
The transaction aligns with Rogers’ business focus, as Staffieri noted that "live sports and entertainment are core to our business strategy." The company’s solid fundamentals support this strategic direction, with a healthy P/E ratio of 12.77 and an attractive dividend yield of 5.4%. For deeper insights into Rogers’ valuation and growth prospects, including exclusive ProTips and comprehensive analysis, visit InvestingPro.
In other recent news, Rogers Communications reported a steady performance in the first quarter of 2023, with both service revenue and adjusted EBITDA increasing by 2% year-over-year. The company maintained its free cash flow at $586 million, unchanged from the previous year, while capital expenditures decreased by 8%. Rogers also highlighted its continued focus on financial discipline, with efforts to reduce leverage and strengthen its balance sheet, supported by a $7 billion equity investment led by Blackstone. The company confirmed that shareholders approved the re-election of all nominated directors and the appointment of its auditors during its recent Annual General Meeting. Rogers Communications also launched its Rogers XFINITY campaign, introducing high-speed internet in select areas, and was recognized for having the most reliable 5G wireless network for the seventh consecutive year. Additionally, the company is exploring opportunities with its sports assets, having renewed its partnership with the NHL and planning to increase its ownership stake in MLSE to 75%. These developments reflect Rogers’ strategic focus on maintaining growth and financial stability in a competitive market environment.
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