2. In the News : : Rogers Microcell Deal Team Fusion

3. Corporate Takeovers  Corporate control is changing the business landscape  Control transactions involve:  takeovers  mergers  leveraged buyouts

4. Microcell Takeover Offers  Telus attempted a hostile takeover  Rogers bid $1.4 billion in a friendly takeover  Telus and Rogers takeover strategies would consolidate major players to three:  Rogers  Telus  Bell

5. Hostile Takeovers  A takeover attempt resisted by target firm  Acquirer sees value in target acquisition  Target may be reasonably priced  An acquisition may offer advantages  Can damage company morale  Could create animosity towards acquirer  Occurs only through publicly traded shares  Acquirer must bypass board of directors to purchase shares

6. Non-Hostile Takeovers  Friendly takeover where company agrees to be purchased  Consists of straight company buyout  May take place for a variety of reasons  Usually a sign of productive activity  Generally endorsed by target

7. Takeover Perspective - Rogers  Takeover would make them largest Canadian wireless provider  Transaction positions them to better compete  Ensures healthy marketplace and benefits customers  “Fido” brand is well-known  Merger is not without risk  Strategy indicates intention to compete with Bell and Telus

8. Target Perspective - Microcell  In 2003 Microcell was re-establishing itself  Telus bid $1.1 billion in hostile takeover  Rogers bid $1.4 billion in a friendly takeover  Microcell supported the Rogers bid  Without merger Microcell would face challenges

9. Rogers/Microcell Deal  $35 a share to buy Microcell  Takeover to be financed with:  $700 million credit line  cash on hand  $900 million from Rogers Communications  totaling $1.6 billion  Acquisition will propel Rogers among top wireless operators

10. Industry Implications  Rogers is a better match for Microcell  Leaves Canada with 3 wireless providers.  Rogers network will be enhanced  Telus/Microcell deal would result in 33% market share  Rogers/Microcell combination result in 35% market share

11. Industry Implications  Rogers gains synergy  Removes a competitor  “Fido” customers can access Rogers network  Combined network enables new technologies  Rates unlikely to rise from increased competition  Merger removes price-aggressive competitor