The escalating crisis at Rogers Communications Inc. has taken another extraordinary twist, with two different men claiming they are chairman and two factions of the Rogers family each saying they have control of the board.
Edward Rogers was named chairman at a meeting in Toronto on Sunday night, according to a statement by a group that says it represents the “reconstituted board” with five new members.
But the company says that meeting was not valid, the 14-member board hasn’t changed at all and John MacDonald remains the chairman.
It’s an unprecedented situation that is now headed to a courtroom. Edward Rogers said he’ll ask the British Columbia Supreme Court to confirm that he has the ability to appoint the 14-member board — including those five new directors, who are all his allies.
Rogers shares fell as much as 6.2 per cent in Toronto, the most since March 2020, and were trading at $56.78 as of 9:56 a.m.
That claim will be fought by his mother, Loretta Rogers, and two of his sisters, Martha Rogers and Melinda Rogers-Hixon, who say their son and brother does not have the power to fire directors and appoint new ones on a whim. Martha Rogers openly mocked her brother’s move on Twitter.
Canada’s largest cable and wireless firm has been in the grips of a family drama for weeks. It’s a battle for control of the boardroom, with Chief Executive Officer Joe Natale’s future and a US$16 billion takeover of rival Shaw Communications Inc. hanging in the balance.
Edward Rogers has tried and failed to get rid of Natale. Loretta Rogers, her two daughters and five independent directors said Sunday: “We unequivocally support Joe Natale as CEO and support his management team.”
“Edward unfortunately continues to proceed down a misguided and miscalculated path which leads nowhere productive and puts his own interests ahead of those of Rogers employees, customers and shareholders,” Loretta Rogers said in a statement Sunday.
She said her son’s claim that he revamped the board Friday using a written shareholder resolution — removing MacDonald and four other directors — represents a “wanton disregard for good governance.”
However, Edward remains chair of the family trust that controls 97 per cent of the voting shares in the company.
As such, he believes he’s able to replace directors immediately through a resolution rather than a traditional vote at a shareholder meeting.
Directors can removed by an ordinary resolution, according to the articles of incorporation posted on Rogers Communications’ website. The articles also state that the vacancy created may be filled at the same meeting.