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Oct 29, 2021

'Brings me no joy': Loretta Rogers blasts son for defying father's wish

Rogers family feud isn't good orthodox corporate governance: Institute of Corporate Directors CEO

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In a detailed affidavit filed with the B.C. Supreme Court on Friday, Loretta Rogers used her deceased husband's own words to decry the behaviour of their son amid the power struggle at Rogers Communications Inc. (RCI)

"It brings me no joy to swear this affidavit," Mrs. Rogers said. "But I feel compelled to do so in light of Edward's conduct."

Her words are landing just a few days before the B.C. Supreme Court is scheduled to hear arguments after Edward Rogers petitioned to have his hand-picked board of directors validated as the rightful governance body overseeing the company. The dispute stems from Mr. Rogers’ attempt to oust Rogers’ chief executive officer, Joe Natale, last month after arguing RCI was underperforming its peers under his leadership. (One of those peers, BCE Inc., owns BNN Bloomberg through its Bell Media division.) 

In her affidavit, Mrs. Rogers expressed disappointment that a family feud has burst into the mainstream, particularly so because she accuses Mr. Rogers of undermining the wishes of his father, Ted Rogers, who founded what is now Canada's largest wireless telecommunications operator.

She referred to The Memorandum of Wishes that Ted Rogers prepared for the trustees and advisory committee of the Control Trust that holds almost all of the voting power at RCI.

Among his wishes, the family patriarch said the chair of the control trust (a role currently held by Mr. Rogers) "must consult widely and earnestly with the Primary Beneficiaries and the Advisory Committee and with the trustees of the Rogers Ownership Trust before making a decision."

The Memorandum of Wishes also documents how Ted Rogers braced for a conflict akin to what's currently playing out.

"Heaven forbid there arises a situation when the majority of the board of [Rogers] are totally opposed to the interests of the Rogers family as represented by the Control Trust Chair," he wrote in the document cited in Mrs. Rogers’ affidavit -- adding "it is hard to speculate" what could possibly result in what he referred to as the "worst of all options."

Nonetheless, in such a scenario, Ted Rogers said if it was a matter of "bed-rock seriousness then the Control Trust Chair would have to go through the public gauntlet of immediately calling a special shareholders meeting."

That, of course, did not occur in the recent chaos at RCI; and in her affidavit, Mrs. Rogers said her husband “always took all shareholder meetings seriously despite the family control” and blasted her son for having “disregarded all of these checks and balances.”

In a recent dizzying sequence of events, Mr. Rogers was pushed out from his role as chair of the company after his plan to replace Natale with (the now former) Chief Financial Officer Anthony Staffieri fell through. He subsequently claimed to avail himself of his power as chair of the Control Trust when he announced that five of the company’s directors had been replaced.

RCI, however, insists Mr. Rogers’ newly-formed board of directors is invalid. 

As investors wait to see how this plays out when it lands in a B.C. courtroom on Monday, they’ve punished RCI’s Class B common share price as the drama unfolds while the company is attempting to close its planned $20-billion takeover of Shaw Communications Inc. – which hasn’t gone unnoticed by Mrs. Rogers.

“I believe that Edward’s steps are undermining [governance] commitments and are prejudicial to Roger’s [sic] non-voting shareholders and the value of the enterprise. One need look only to the drop in the Rogers’ share price since the market learned of Edward’s schemes.”

Mrs. Rogers also stated that “the final straw” for her was when she learned through a media report that Mr. Rogers was planning his overhaul of the board of directors. Those plans came to light in a Bloomberg News article published on Oct. 21.

“The independent directors that Edward tried to remove had done exactly what shareholders expect of them – they spoke truth to Edward’s power,” she said. “They criticized Edward for attempting to insert himself as the de facto CEO of Rogers and jeopardizing the Shaw merger.”