Power struggle ends with Rogers board booting out chairman
Son of late founder stays on as a director after attempt to shake up telecom giant
Directors of Rogers Communications Inc. have voted to oust Edward Rogers, son of the company's founder, as chairman of the board after a fractious few weeks that began with his attempt to replace chief executive Joe Natale in a major management shakeup.
In a brief statement released late Thursday, Rogers Communications confirmed that Edward Rogers “has moved from the role of Chairman effective today,” but will remain on the board as a director.
John A. Macdonald, a board member since 2012, who also served as lead director and chairman of the corporate governance committee “has assumed the role of Chairman of the Board of Directors,” according to the statement.
“This has been a challenging time for the Corporation and I want to reaffirm on behalf of the majority of the Board our support for and total confidence in the management team and CEO of Rogers Communications,” Macdonald said.
In an initial attempt to quell the corporate disruption, which has divided the Rogers family, the board had created an executive oversight committee to “establish clear protocols” to manage interactions between senior leadership and the board chairman.
The new three-member committee — whose members included Rogers's sister, deputy chairwoman Melinda Rogers-hixon, Macdonald, a longtime industry leader who held roles at BCE Inc. and Allstream Business Inc., and another independent director John Clappison — was made public in management discussion accompanying Rogers's third-quarter financial report Thursday, but had been in the works for weeks and came amid reports that Edward was seeking to replace at least some of the company's independent directors.
Sources familiar with the situation say Edward has obtained a list of the company's shareholders, which would be needed to pursue board changes. Independent directors had objected to handing it over, due to uncertainty about whether Edward was acting with support of the voting trust through which his company controls Rogers Communications, these sources say. The directors also expressed concern that the ongoing disruption was hurting the company and could be detrimental to its planned $26-billion (including debt) purchase of rival Shaw Communications Inc., the sources said.
The dispute has divided the Rogers family, with Edward's mother Loretta Rogers and sisters Martha Rogers and Rogers-hixon opposing his plan to oust Natale.
Sources familiar with the situation who were not authorized to speak publicly about it say the advisory committee to the Rogers Control Trust, the entity through which the family controls the company, has held discussions over whether conditions should be placed on how Edward, who is chairman of the trust, can vote the class A shares it holds.
It was not immediately clear how his departure as chairman of Rogers will affect those discussions, or whether it would halt any efforts to reshape the board.
Bloomberg News reported Thursday that Edward had produced a list of preferred candidates to replace independent directors. According to the report, the list contained five names including former CTV media chief executive Ivan Fecan and Jan Innes, a longtime communications and government-relations adviser at Rogers. She remains a director of the Rogers Group of Funds, which supports film and television funding, according to her Linkedin page.
Natale, who has said little since Edward attempted to replace him with chief financial officer Tony Staffieri, responded to questions about the dispute on a conference call with analysts following Thursday morning's release of the company's financials. “I've got strong, unequivocal support from the board to direct the strategy of the company,” he said, adding that he will “continue to drive the improvements and momentum that you're seeing.”
He told analysts the corporate drama has not changed his views on the proposed takeover of rival Shaw Communications.
Rogers's revenues grew marginally in the third quarter from a year ago. The Toronto-based telecom reported sales of $3.67 billion for the three months ended Sept. 30, led by growth in the wireless business and lower churn rates.