Rogers Communications Inc.’s takeover of Shaw Communications Inc. cleared one of three crucial hurdles Thursday.

The Canadian Radio-television and Telecommunications Commission announced in a release after markets closed that it approved the $20-billion deal, subject to certain conditions and modifications.

Among the requirements applied to the deal by the CRTC, Rogers will have to pay $27.2 million in benefits into the broadcasting system, roughly five times what it originally proposed. The regulator also instructed Rogers to provide annual reports on its pledges to bolster local news coverage. As well, the CRTC said it will implement “safeguards” designed to protect independent programming services in negotiations with Rogers.

“Given the nature of this transaction, we have put in place safeguards aimed at addressing potential risks to the broadcasting system for both consumers and programming services. Rogers must honour all existing contracts for Shaw customers. This adds to the safeguards already in place, which allow Canadians to subscribe to a basic television package and to select channels either individually or in small packages," said CRTC Chair and Chief Executive Officer Ian Scott in the release.

The CRTC’s approval was strictly focused on Rogers’ acquisition of Shaw’s broadcasting assets.

“This part of the overall Rogers-Shaw deal was the most innocuous and always seemingly destined to be approved notwithstanding certain interventions during the process,” wrote National Bank of Canada Financial Markets Analyst Adam Shine in a report to clients Thursday evening.

The takeover still requires the approval of the Competition Bureau and Innovation, Science and Economic Development Canada (ISED).

“We appreciate the CRTC’s thoughtful inquiry and remain committed to working with government and regulators to achieve a successful completion of our proposed transaction with Rogers,” said Shaw Executive Chair and Chief Executive Brad Shaw in a statement.

In a separate release, Rogers said it’s continuing to “work constructively” with the Competition Bureau and ISED as they evaluate the transaction.

Rogers and Shaw reiterated in their statements Thursday that they expect the deal to close by the end of June.

Since the day the deal was announced on March 15, 2021, Shaw’s Class B shares have consistently traded at a discount to Rogers’ offer of $40.50, suggesting there’s some skepticism in the market about the outcome.

Bay Street has largely focused on the implications of the takeover for the two companies’ wireless assets; and François-Philippe Champagne, the minister of innovation, science and industry, has made it clear that Rogers will have to give something up to move forward with the deal.  

“The transfer of [wireless] licences from Shaw to Rogers as a whole would be incompatible with our long-stated policy. My main concern is competition, affordability, and innovation,” he said in an interview Wednesday.