Cogeco announces its acquisition of Oxio
No one expected it, yet cable operator Cogeco has just announced the acquisition of Oxio. Should Oxio customers expect changes?
In a press release, Cogeco Connexion has just announced the acquisition of Oxio for an amount that has not yet been specified.
In the context of buyouts among various Canadian operators and suppliers, Quebec-based Cogeco is very well positioned in rural areas but had not previously set foot in major cities such as Montreal. The acquisition of Oxio now allows Cogeco to cover the major cities. According to a calculation by Jérôme Dubreuil of Desjardins, the amount would be estimated between 20 and 35 million. However, it is difficult to believe such an amount. Each customer brings in a minimum of $4 per month for Oxio, while its Gaiia software, which seems to be a great advance, is capable of replacing the ten or so software programs usually used by suppliers. Moreover, Oxio had 30,000 customers in May 2022, while many of them have remained with Oxio since the beginning, and it is known that providers make more money on loyal customers. Therefore, we estimate that the amount paid to acquire oxio should be double or even triple what was calculated by Desjardins
According to Frédéric Perron, President of Cogeco Connexion: “Oxio is an attractive brand with high customer satisfaction and a great team. Its home Internet offering, based on a digital-only experience, is an exciting addition to our wide range of high-quality telecommunications services. With the acquisition of Oxio, Cogeco Connexion will now have a second brand to serve the telecommunications needs of Canadians.”
Should Oxio customers expect any changes?
Cogeco is not likely to disrupt oxio’s habits or those of its customers. Oxio should therefore continue its mission as an independent provider without having to increase its rates or change anything as a result of this acquisition. The change should rather take place on the side of Cogeco’s customers who intend to use the Gaiia software developed by Oxio. It would therefore be logical to think that Cogeco acquired oxio for two reasons.
First, as mentioned above, oxio will allow Cogeco to reach new territories, notably the major cities of Quebec and Ontario. Secondly, Cogeco’s immediate use of the Gaiia software suggests that Oxio has developed a high-level tool capable of competing with the biggest. Cogeco could therefore have bought Oxio for Gaiia as well, which would not be a first. Finally, the weight of Cogeco could also allow the acquisition and offering of additional programs on oxio TV.
The acquisition of Oxio by Cogeco seems to be good news for the customers of both providers. Oxio’s customers will benefit from Cogeco’s weight and its acquisitions for Oxio TV, while Cogeco’s customers will have better software at their disposal.