Calgary Economic Development says loss of Shaw head office disappoints but regional office eases pain

Click to play video: 'What does Rogers-Shaw merger mean for Calgary?'
What does Rogers-Shaw merger mean for Calgary?
WATCH: Two of Canada’s largest telecommunications companies have announced a deal to combine forces. As Jill Croteau reports, the Rogers-Shaw merger could have a big impact on Calgary’s economy – Mar 15, 2021

The loss of the Shaw Communications Inc. headquarters in Calgary following the proposed sale of the company to Rogers Communications Inc. is part of a long-term slide in the city’s economy as oil and gas companies scale down in view of years of lower commodity prices.

But Mary Moran, CEO of Calgary Economic Development, says while the loss of a head office is disappointing, the fact the companies are retaining a Western Canada headquarters in Calgary and have promised to create more jobs in the region is heartening.

Read more: Rogers set to buy Shaw in deal valued at $26 billion

Rogers says it will invest $6.5 billion in Western Canada to build 5G networks, connect underserved rural and Indigenous communities, and add choice for customers while creating up to 3,000 net new jobs in the four western provinces.

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Calgary lost nine head offices and 3,600 head office jobs between 2014 and 2019, Statistics Canada says. Over the same period, the number of head office jobs in Alberta fell by almost 5,500 positions while it rose by almost 2,800 positions in the rest of the country.

“Our concern is, first of all, we lose a head office,” said Moran in an interview.

“We’ll gain a regional head office with Rogers’ commitment to continue to expand in here.

“They’ve talked a lot about the investment they’re going to make into the region, so $6.5 billion into the region and creating 3,000 jobs, of which we’re pretty comfortable a fair number of them will come into Calgary.”

Premier Jason Kenney called the merger good news for Alberta, and said the government will “hold Rogers to those commitments, as they would be good news for Alberta’s economy,” if the merger goes ahead.

Kenney said the merger will bring an influx of jobs — as many as 1,800 province wide, with about 500 of those in Calgary — especially high-tech positions, further diversifying the economy and building up the growing tech sector.

Read more: New report suggests solutions for Calgary’s ‘office vacancy crisis’

Kenney also celebrated the expected expansion of 5G high-speed internet across the province, saying it would be beneficial for those living in rural, remote and Indigenous communities.

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“By choosing Calgary as the home for this new national centRE for technology and engineering excellence, it’s further proof that Alberta’s recovery plan is working and our economy is diversifying,” Kenney said.

“The government of Alberta will closely monitor Rogers’ regulatory filings and we will likely make submissions to the regulatory agencies to defend the best interests of our economy and our consumers.

“In particular, we’ll seek to have the commitments that have been made to increase employment and investment, we will seek to have those made as a condition of federal regulatory approval.”

Click to play video: '‘It’s going to end up costing consumers more’: Global’s Anne Gaviola on possible Rogers–Shaw merger'
‘It’s going to end up costing consumers more’: Global’s Anne Gaviola on possible Rogers–Shaw merger


Read more: Rogers-Shaw merger could mean higher prices for consumers, experts warn 

Kenney said he would have liked to have the national head office established in Alberta, but said he’s pleased to see the regional office coming to Calgary, even if it means the loss of the Shaw head office.

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“I would be a lot more concerned if this represented a net loss of jobs. But to the contrary, Rogers is making very strong and public commitments, which they reiterated to me privately, that this will lead to a significant net increase in good paying jobs in Alberta and a significant increase – multi-billion dollar increase – in investment for their wireless and high speed infrastructure in this province,” Kenney said.

The premier said he was also happy to hear the new, merged company would expand relationship with the University of Calgary, and plans to continue with strong commitments with local charities and community groups, as well as indigenous-owned and operated internet providers.

Calgary Mayor Naheed Nenshi said he spoke with Rogers CEO Joe Natale Sunday evening.

Click to play video: 'Rogers signs deal to buy Shaw in deal valued at $26 billion'
Rogers signs deal to buy Shaw in deal valued at $26 billion

“Mr. Natale expressed his love for Calgary, which is nice, and pledged that there would not be a, quote, ‘giant sucking sound out of Calgary as a result of this deal,’ which is great,” Nenshi said Monday. “But of course, we will stand firm on our need for assurances of that and to really understand what’s going to happen to the workforce going forward.”

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Nenshi was reassured by Natale that there would be a net gain of jobs in the city.

“The problem is, I don’t know where those jobs will be vis-a-vis the ones that may move.”

Nenshi pitched moving more of Rogers’ corporate functions and overall business to downtown Calgary, to help alleviate the near-30 per cent vacancy rate and that the telecommunications giant could take advantage of low rent rates.

Calgary’s mayor said he told Natale “we would not look positively at anything that would increase” downtown vacancies, noting that Shaw is one Calgary’s most important head offices.

Read more: ‘Mild hiring climate’ expected for Calgary in the spring: ManpowerGroup

Nenshi said if he was in his previous role as management consultant to large corporations, he would highlight the opportunity to move from a high-rent to a low-rent market in moving business operations from the Greater Toronto Area to downtown Calgary.

“Remember, with Amazon — without any government incentives — if they took their Seattle office and put it in in downtown Calgary, they would save nearly $2 billion a year.”

Shaw Communications has been a major part of the Alberta economy since the company was co-founded by J.R. Shaw and incorporated in Edmonton in 1966 under the name Capital Cable Television Co. Ltd.

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It connected its first cable customer and went on the air for the first time in 1971, eventually moving its head office to Calgary in the mid-1990s and growing into one of the country’s largest cable providers, with radio and television broadcasting assets and a substantial wireless business.

J.R. Shaw remained active in the company to the end, serving as executive chair until his death a year ago. His son Brad Shaw is the current chief executive and executive chair.

The Shaw family has been able to retain control of the company through the Shaw Family Living Trust and its subsidiaries, which held about 79 per cent of the voting shares at the end of 2021, according to a recent regulatory filing.

The Shaw family controls both Shaw Communications and Corus Entertainment, the parent company of Global News.

— With files from Adam Toy, CHQR 770 and Heide Pearson, Global News

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