Shaw Communications Inc. announces sale of ViaWest to Peak 10 for approximately C$2.3 billion
June 13, 2017
CALGARY, June 13, 2017 – Shaw Communications Inc. (“Shaw”) announced today that it has entered into a share purchase agreement ("SPA") with GI Partners portfolio company Peak 10 Holding Corporation (“Peak 10”) to sell 100% of its wholly-owned subsidiary ViaWest, Inc. (“ViaWest”) for approximately C$2.3 billion (US$1.675 billion) (the "Transaction"). ViaWest provides hybrid IT solutions, including colocation, cloud computing and security and compliance for North American enterprises.
“The ViaWest acquisition in 2014 marked a pivotal moment in Shaw’s history and provided a growth engine which has delivered, and continues to deliver, strong results. The outlook for ViaWest remains robust, though the North American colocation and managed services industry is consolidating and scale is becoming an important factor for continued long-term success. We believe the combination of ViaWest and Peak 10 creates a platform for growth and ensures the combined entity’s customers and employees are well positioned for the future. I would like to personally thank Nancy, her management team, and all 600 of ViaWest’s employees for their commitment and dedication during the three years of Shaw’s ownership,” said Brad Shaw, Chief Executive Officer, Shaw Communications.
“The combination of ViaWest and Peak 10 creates the largest privately held and most respected provider of data centre infrastructure, cloud technology and managed IT solutions in North America with a national footprint,” said Nancy Phillips, President & CEO of ViaWest. “We believe that bringing together these hybrid IT infrastructure companies strengthens ViaWest’s position among its competitors and, as a combined entity, will be able to further leverage and maximize growth opportunities.”
“We will continue to partner with the new entity to leverage its combined expertise and scale to provide our Western Canadian data centre customers with greater innovation and breadth of services, which is consistent with our best-in-class partner-led approach,” Mr. Shaw said.
As exclusive financial advisor to Shaw, TD Securities Inc. ("TD Securities") provided an opinion to the Board of Directors of Shaw that, subject to the assumptions, qualifications and limitations provided therein, the consideration to be received by Shaw pursuant to the Transaction is fair to Shaw, from a financial point of view.
The purchase price of approximately C$2.3 billion (US$1.675 billion), represents an attractive return on Shaw’s original investment of US$1.2 billion, or approximately C$1.3 billion at the prevailing exchange rate at the time. Consideration pursuant to the Transaction is comprised of all cash.
Shaw expects to realize net cash proceeds from the Transaction of approximately C$900 million after the repayment of ViaWest level indebtedness of approximately US$580 million, repayment of the US$380 million Shaw credit facility borrowings associated with the original investment and subsequent INetU acquisition, and estimated Transaction expenses and taxes.
The Transaction is subject to customary conditions, including U.S. regulatory approval and is expected to close by the end of fiscal 2017 . The Transaction is not subject to a financing condition.
Advisors and Legal Counsel for Shaw
TD Securities acted as exclusive financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP and Dentons Canada LLP provided legal advice.
Shaw Communications Inc. is an enhanced connectivity provider. Our Consumer division serves consumers with broadband Internet, Shaw Go WiFi, video and digital phone. Our Wireless division provides wireless voice and data services through an expanding and improving mobile wireless network infrastructure. The Business Network Services division provides business customers with Internet, data, WiFi, telephony and video. The Business Infrastructure Services division, through ViaWest, provides hybrid IT solutions including colocation, cloud computing and security and compliance for North American enterprises.
Shaw is traded on the Toronto and New York stock exchanges and is included in the S&P/TSX 60 Index (Symbol: TSX - SJR.B, SJR.PR.A, SJR.PR.B, NYSE – SJR, and TSXV – SJR.A). For more information, please visit www.shaw.ca.
Shaw Communications Inc.
Shaw Communications Inc.
Chethan Lakshman, VP External Affairs