Blackstone, alongside a group of leading Canadian institutional investors, has agreed to invest $7bn in a new subsidiary of Rogers Communications, marking one of the largest private equity-led infrastructure transactions in North America this year.

The private equity giant will acquire a 49.9% equity interest and 20% voting interest in the newly formed subsidiary, which will house a portion of Rogers’ wireless network assets. Rogers will retain full operational control with a 50.1% equity stake and 80% of the voting rights.

The transaction, which is structured to be treated as equity by major credit rating agencies, is expected to reduce Rogers’ debt leverage ratio by 0.7x. Rogers intends to use the proceeds to repay a portion of its $33.7bn debt load.

The investor group includes Canada Pension Plan Investment Board (CPPIB), Caisse de dépôt et placement du Québec (CDPQ), Public Sector Pension Investment Board (PSP Investments), and British Columbia Investment Management Corporation (BCI).

The subsidiary is expected to distribute $400m annually to Blackstone over the first five years post-closing. Rogers’ average capital cost from the deal is projected to be 7% per annum. The company retains the option to repurchase Blackstone’s stake between the eighth and twelfth anniversaries of closing.

The deal underscores private equity’s continued interest in infrastructure-backed telecom assets and is expected to close in Q2 2025, subject to customary conditions.