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Melinda Rogers-Hixon Wants Peace With Her Brother But Deep Rifts Remain

(Bloomberg) — Melinda Rogers-Hixon wants peace — within her family and inside the boardroom of Canada’s largest wireless and cable company.

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Perched on a sofa inside her home in one of Toronto’s most upscale neighborhoods, the heiress of the Rogers Communications Inc. empire is working hard to project an air of calm diplomacy.

She expresses confidence that she and her older brother, Chairman Edward Rogers, can patch things up after a messy battle for control landed them on opposing sides of a Vancouver courtroom. After all, she points out, they have an obligation to employees, customers and shareholders to do so. And for all the differences the two have had, never once, she says, did she doubt his intentions.

“I believe that my brother wants to do what’s right for the company,” she said during a 90-minute interview.

And yet, there were moments in the interview that revealed the magnitude of the fissures inside the Rogers clan, and how tricky repairing them will be, as the company enters a critical phase in its $16 billion takeover of rival Shaw Communications Inc. Rogers-Hixon cited C-suite turnover under her brother’s leadership and the constant strategy shifts; she made clear she still has issues with his choice of CEO; and she hinted at discontent in the top ranks.

The power struggle has died down for the moment, and family members speak to one another regularly, she said. But important matters remain unresolved, including the top executive. Rogers-Hixon, her sister, Martha Rogers, and her mother, Loretta Rogers — all board members — had wanted to stick with Joe Natale, the CEO since 2017. Edward wanted Tony Staffieri, the longtime chief financial officer. A month ago, after prevailing in court, Edward and his board allies installed Staffieri, officially on an interim basis.

When asked her opinion about Staffieri and whether she’d support making him the permanent boss, Rogers-Hixon rattled off the list of what she wants in a CEO.

“If you are doing a job search for somebody to run a C$50 billion corporation, I fully and firmly believe operating experience is a must. And not even six months of operating experience,” she said. “Former CEO experience would be, frankly, very nice as well.” Staffieri is a career finance executive who hasn’t been a CEO before.

The conflict isn’t personal, she said. Merging with Shaw was a dream held by her late father, company founder Ted Rogers. But it will be the largest and most complex deal Rogers Communications has ever done, assuming it can win approval from regulators.

The company is making several promises to win the favor of investors and government officials, including that it will wring out C$1 billion ($780 million) in savings. It says it will spend C$1 billion on high-speed internet for remote places and another C$2.5 billion to improve wireless networks in western Canada. “We have a responsibility to ensure that we have the best person in the role of CEO that we can possibly get,” said Rogers-Hixon, 50.

Most analysts expect Rogers to face a tough negotiation with Canada’s competition body and the government before closing the deal sometime in 2022. In the meantime, the revolving door still spins at the company’s headquarters in Toronto.

There’s a new head of the cable division, Robert Depatie, until recently a director who aligned himself with Edward Rogers in the boardroom battle. “Thirteen years and you’ve had four heads of cable? Wait, so now you have a fifth, who’s changing the strategy again,” Rogers-Hixon said.

She’s concerned about potential instability in other parts of the company, including in the wireless unit, which is by far the company’s most important business. Wireless head Dave Fuller is a Natale protege who has already stated publicly that he doesn’t want to work for another CEO.

“Dave Fuller? Oh my god, he’s worth his weight in gold,” Rogers-Hixon said. The company is coming off its best third quarter in wireless in years.

“Think of Bell or Telus,” she said, referring to Rogers’s main competitors. “This is their biggest dream. The more unstable we are, the harder it is for us to execute and the easier it is for them to outperform us.”

For Rogers-Hixon, there appears to be lingering frustration about the way the events played out this fall. She tried to craft a compromise with her brother, one that might have kept the family out of court and the Rogers Communications board intact. It failed when some of her father’s oldest friends, who have a role in the Rogers family trust that controls the public company, wouldn’t support it.

What followed was an extraordinary series of events that transfixed corporate Canada. Loretta Rogers, the company matriarch, moved a motion to remove her own son as chairman of Rogers Communications. He sued to restore his authority, and for nearly two weeks, two factions claimed to have control of the board at one of Canada’s biggest public companies, until a judge finally ruled in his favor. That allowed him to unilaterally fire five directors who’d opposed him.

The company’s shares are on track for a third consecutive year of declines — that hasn’t happened since the 1990s — and trade at a big discount to its major rivals, partly because of the turmoil and a perception of poor governance. Investors, Rogers-Hixon said, “didn’t really understand that the board could be reconstituted with literally a signature.”

Rogers-Hixon says she knows that she and her brother need to find a way to turn things around. “It’s an obligation, a responsibility — not only as a board member and a shareholder, but as a member of the family. And as a daughter of my father’s.”

Ted Rogers, she said, would be appalled by recent developments.

“He was actually quite principled, and I think he’d kick our ass, frankly,” she said. “He’d be pissed.”

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