Rogers chairman failed to oust CEO amid power struggle with sister, board

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The recent departure of Rogers Communications Inc.’s long-standing chief financial officer was the result of a high-level power struggle at Canada’s biggest wireless carrier that saw chairman Edward Rogers unsuccessfully attempt to unseat CEO Joe Natale.

Tony Staffieri’s abrupt exit on Sept. 29 comes at a pivotal time for Rogers, as the company seeks regulatory approval to acquire Shaw Communications Inc. for $26-billion including debt and makes multibillion-dollar investments in 5G wireless networks.

Tensions between Mr. Natale and Mr. Staffieri have been brewing for years, according to people familiar with the matter. Mr. Staffieri, who joined Rogers in 2012 and developed a close relationship with the company’s chairman, had ambitions to be chief executive officer, and frequently butted heads with Mr. Natale regarding the company’s strategic direction, sources say. The Globe is not identifying the sources because they are not authorized to speak publicly about the matter.

Mr. Natale returned from the most recent Christmas break intending to start searching for a new CFO, but events surrounding the company’s proposed acquisition of Shaw, which was announced in March, overtook his plans, according to a source close to the situation. However, in the weeks leading up to Mr. Staffieri’s departure, Mr. Natale had begun speaking with external candidates to line up a CFO to oversee the integration, according to the source.

Meanwhile, Edward Rogers was attempting to remove Mr. Natale from the top job and make Mr. Staffieri CEO, according to three sources familiar with the matter. One of the sources said Mr. Rogers was also planning to remove other members of the executive team – some of whom are deeply loyal to Mr. Natale. Mr. Rogers did not respond to an e-mail requesting comment. When reached, Mr. Staffieri declined to comment.

ROGERS COMMUNICATIONS

ADVISORY COMMITTEE

Rogers family members

Trustees of a trust for the

benefit of Rogers family members

Loretta A. Rogers

Loretta Rogers, wife and confidant of Ted Rogers for more than four decades, grew up in the Bahamas and Bermuda and is an accomplished painter with a fine arts degree from the University of Miami. Her family financed Ted Rogers’s initial venture into radio and cable.

Melinda M. Rogers-Hixon

Melinda Rogers-Hixon earned an MBA and worked in a variety of executive roles, including running Rogers’ venture capital arm in Silicon Valley for seven years. She is deputy chair of the Rogers board and vice-chair of the family trust.

Edward S. Rogers

Edward Rogers III, only son of Ted Rogers, worked three years at U.S. cable giant Comcast prior to joining Rogers and eventually running the cable division for six years. He is now chair of both Rogers Communications and the family trust.

Lisa A. Rogers

Lisa Rogers is the oldest of Ted and Loretta Rogers’ four children and worked for the company’s first Internet cable venture in the 1990s.

David A. Robinson

David Robinson is Loretta Rogers’s nephew, and worked at Rogers before becoming chief commercial officer at fintech company Clik2pay.

Martha L. Rogers

Martha Rogers is the youngest of the founder’s four children and earned a doctorate in naturopathic medicine. She has been a Rogers board member for 13 years.

Alan D. Horn

Alan Horn was Rogers chief financial officer for a decade, under Ted Rogers, and remains a trusted family adviser. The former accountant served as interim CEO on two occasions, when Ted Rogers passed away in 2008 and again in 2016.

John H. Tory

John Tory, Mayor of Toronto, ran Rogers cable operations for eight years under Ted Rogers and was one of the company’s lawyers early in his career. His late father, a lawyer, was also a trusted family adviser.

Thomas I. Hull

Thomas (Toby) Hull founded insurance brokerage The Hull Group in 1954 and was one of Ted Roger’s closest friends from childhood – the two attended Upper Canada College together.

Phil Lind was Ted Rogers right hand man for four decades, running divisions of the company and taking part in every major decision. When the founder died in 2008, Mr. Lind joined Edward Rogers, Mr. Horn and Mr. Tory as pallbearers at the funeral.

THE GLOBE AND MAIL

ROGERS COMMUNICATIONS

ADVISORY COMMITTEE

Rogers family members

Trustees of a trust for the

benefit of Rogers family members

Melinda M. Rogers-Hixon

Loretta A. Rogers

Loretta Rogers, wife and confidant of Ted Rogers for more than four decades, grew up in the Bahamas and Bermuda and is an accomplished painter with a fine arts degree from the University of Miami. Her family financed Ted Rogers’s initial venture into radio and cable.

Melinda Rogers-Hixon earned an MBA and worked in a variety of executive roles, including running Rogers’ venture capital arm in Silicon Valley for seven years. She is deputy chair of the Rogers board and vice-chair of the family trust.

Lisa A. Rogers

David A. Robinson

Lisa Rogers is the oldest of Ted and Loretta Rogers’ four children and worked for the company’s first Internet cable venture in the 1990s.

David Robinson is Loretta Rogers’s nephew, and worked at Rogers before becoming chief commercial officer at fintech company Clik2pay.

Edward S. Rogers

Martha L. Rogers

Edward Rogers III, only son of Ted Rogers, worked three years at U.S. cable giant Comcast prior to joining Rogers and eventually running the cable division for six years. He is now chair of both Rogers Communications and the family trust.

Martha Rogers is the youngest of the founder’s four children and earned a doctorate in naturopathic medicine. She has been a Rogers board member for 13 years.

John H. Tory

Alan D. Horn

Alan Horn was Rogers chief financial officer for a decade, under Ted Rogers, and remains a trusted family adviser. The former accountant served as interim CEO on two occasions, when Ted Rogers passed away in 2008 and again in 2016.

John Tory, Mayor of Toronto, ran Rogers cable operations for eight years under Ted Rogers and was one of the company’s lawyers early in his career. His late father, a lawyer, was also a trusted family adviser.

Thomas I. Hull

Thomas (Toby) Hull founded insurance brokerage The Hull Group in 1954 and was one of Ted Roger’s closest friends from childhood – the two attended Upper Canada College together.

Phil Lind was Ted Rogers right hand man for four decades, running divisions of the company and taking part in every major decision. When the founder died in 2008, Mr. Lind joined Edward Rogers, Mr. Horn and Mr. Tory as pallbearers at the funeral.

THE GLOBE AND MAIL

ROGERS COMMUNICATIONS ADVISORY COMMITTEE

Rogers family members

Trustees of a trust for the benefit of Rogers family members

Melinda M. Rogers-Hixon

Loretta A. Rogers

Edward S. Rogers

Loretta Rogers, wife and confidant of Ted Rogers for more than four decades, grew up in the Bahamas and Bermuda and is an accomplished painter with a fine arts degree from the University of Miami. Her family financed Ted Rogers’s initial venture into radio and cable.

Edward Rogers III, only son of Ted Rogers, worked three years at U.S. cable giant Comcast prior to joining Rogers and eventually running the cable division for six years. He is now chair of both Rogers Communications and the family trust.

Melinda Rogers-Hixon earned an MBA and worked in a variety of executive roles, including running Rogers’ venture capital arm in Silicon Valley for seven years. She is deputy chair of the Rogers board and vice-chair of the family trust.

Lisa A. Rogers

David A. Robinson

Martha L. Rogers

Lisa Rogers is the oldest of Ted and Loretta Rogers’ four children and worked for the company’s first Internet cable venture in the 1990s.

David Robinson is Loretta Rogers’s nephew, and worked at Rogers before becoming chief commercial officer at fintech company Clik2pay.

Martha Rogers is the youngest of the founder’s four children and earned a doctorate in naturopathic medicine. She has been a Rogers board member for 13 years.

Alan D. Horn

John H. Tory

Thomas I. Hull

Thomas (Toby) Hull founded insurance brokerage The Hull Group in 1954 and was one of Ted Roger’s closest friends from childhood – the two attended Upper Canada College together.

Alan Horn was Rogers chief financial officer for a decade, under Ted Rogers, and remains a trusted family adviser. The former accountant served as interim CEO on two occasions, when Ted Rogers passed away in 2008 and again in 2016.

John Tory, Mayor of Toronto, ran Rogers cable operations for eight years under Ted Rogers and was one of the company’s lawyers early in his career. His late father, a lawyer, was also a trusted family adviser.

Phil Lind was Ted Rogers right hand man for four decades, running divisions of the company and taking part in every major decision. When the founder died in 2008, Mr. Lind joined Edward Rogers, Mr. Horn and Mr. Tory as pallbearers at the funeral.

THE GLOBE AND MAIL

According to the sources, an emergency board meeting was held on Sunday, Sept. 26. Melinda Rogers-Hixon, deputy chair of the family-controlled company and Mr. Rogers’s sister, strongly opposed Mr. Rogers’s plan, and the overwhelming majority of the board and the family backed Mr. Natale and his management team. Mr. Staffieri’s departure was announced three days later. (In an e-mailed statement, Ms. Rogers-Hixon said she has no comment regarding her family or the board’s confidential discussions.)

Scott Davidson, a spokesperson for Rogers, said the company is “disappointed that confidential discussions at the board level were shared publicly.”

“As with any similar transition, the recent CFO change was voted on and approved by the majority of the board of directors. The majority of the board has full confidence in Joe’s leadership and strategic vision for Rogers as we look forward to the transformational combination of Rogers and Shaw and continue to focus on delivering long-term value for our customers and shareholders,” Mr. Davidson said in a statement.

Executive turnover has plagued Rogers since the company’s founder, Ted Rogers, died in 2008. The Toronto-based telecom has been through three CEOs in the past 13 years, with the last two leaders recruited by Edward Rogers, then found wanting by the chairman.

In 2013, Mr. Rogers personally led the campaign to lure former Vodafone Group PLC executive Guy Laurence to the company as CEO. Mr. Laurence made headlines by signing deals with Vice Media, mocked rival Bell Canada and boosted the number of wireless customers. However, he alienated the Rogers family by moving both Edward and Melinda out of operating roles at the company. Mr. Laurence departed suddenly in 2016; he is now CEO of British Premier League soccer team Chelsea.

To replace him, Mr. Rogers went to considerable trouble to land Mr. Natale, the former chief executive of Telus Corp. Mr. Rogers led the recruitment, helping to negotiate an agreement that freed Mr. Natale from a lengthy non-compete agreement with Telus. Rogers executives and advisers said they have never seen Mr. Rogers happier than the day in March when Mr. Natale fulfilled Ted Rogers’s dream of building a truly national platform by announcing the Shaw takeover.

Many industry observers were taken aback by the timing of Mr. Staffieri’s departure. “I found it surprising for [Mr. Staffieri] to be leaving at this stage, while they’re in the midst of the Shaw merger. … Usually that type of departure doesn’t occur until after the deal closes,” said Edward Jones analyst Dave Heger. “I think everyone was kind of caught off guard by it.”

The company’s proposed acquisition of Shaw requires approval from three regulatory bodies – the Competition Bureau, the Canadian Radio-television and Telecommunications Commission (CRTC) and the Ministry of Innovation, Science and Economic Development. The deal is expected to face intense regulatory scrutiny, as it would eliminate the fourth-largest wireless carrier.

Rogers’s shares have been trading at a valuation discount relative to its peers for more than a decade, a fact that Scotiabank analyst Jeff Fan attributes partly to a network-sharing agreement between BCE Inc.’s Bell Canada and Telus Corp. Acquiring Shaw, and its Western Canadian cable footprint, is an opportunity for Rogers to narrow that gap.

The deal, which Rogers expects to close in the first half of 2022, comes after a failed bid for Cogeco Inc. and Cogeco Communications Inc. last year. In September, 2020, Rogers paired up with Altice USA Inc. to launch a hostile takeover bid for the Quebec cable companies that was repeatedly rebuffed by their controlling shareholder, the Audet family, despite being sweetened to $11.1-billion.

Rogers has also hit snags in its wireless business in recent years. Its stock took a hit in the fall of 2019, when the company reported that its transition to unlimited data wireless plans had led to a sharp drop in lucrative overage revenues. (BCE Inc. and Telus Corp. also launched unlimited data plans, but transitioned customers more gradually.)

In April, Rogers experienced a massive wireless network outage that left customers unable to text, make calls or access mobile data for 16 hours, just as the country was in the throes of a surging third wave of COVID-19 cases. The pandemic has had an outsized effect on Rogers, which derives more of its revenues from the wireless business and, in particular, from roaming charges, which plunged due to travel restrictions.