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Shaw Communications Inc., which has struck a deal to be acquired by Rogers Communications Inc., saw its second-quarter profit and revenue climb as it added new wireless customers.

Shaw reported $217-million in profit for the three-month period ended Feb. 28, up about 30 per cent from a year ago when it had $167-million in profit. The earnings amounted to 43 cents per share, up from 32 cents per share during the second quarter of 2020.

Its revenue for the quarter came to $1.39-billion, up 1.8 per cent compared to the same period last year. Analysts had been expecting revenue of $1.38-billion, according to the consensus estimate from S&P Capital IQ.

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Shaw also added 82,300 net new wireless subscribers at its Freedom Mobile and Shaw Mobile brands during the quarter, but lost 66,030 video, internet and home phone customers.

Edward Jones analyst Dave Heger said that although Shaw has been attracting new wireless subscribers, the wireline side of its business – which includes television and internet services – appears more focused on managing its costs than on expansion.

“They seem to continue to struggle to compete with Telus,” Mr. Heger said. “It seems like they’ve been managing that business more to maintain profitability and cash flow … but not necessarily to try to grow it.”

The earnings come amid a deal that would see Rogers acquire Shaw for $26-billion including debt. The deal would combine two of the country’s largest cable operations and reduce the number of wireless players from four to three in Ontario, Alberta and British Columbia. It requires approval from by the Competition Bureau; Innovation, Science and Economic Development Canada (ISED); and the Canadian Radio-television and Telecommunications Commission.

Canaccord Genuity analyst Aravinda Galappatthige said he expects that the deal will ultimately close, although with some remedies to appease regulators.

“Importantly, the vast majority of the comments we have heard from various industry stakeholders, including the ISED Minister, have almost exclusively focused on wireless, suggesting that the case for opposing the cable merger is weak,” Mr. Galappatthige said in a note to clients. He predicted that the Competition Bureau could greenlight the acquisition either later this year or in early 2022.

A number of industry observers and insiders, including Quebecor Inc.’s president and CEO Pierre Karl Péladeau, have argued that Shaw’s wireless business should be excluded from the merger in order to prevent a lessening of competition. Mr. Péladeau has also hinted that Quebecor would be an interested buyer.

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