March 24 (Reuters) - Canada's telecommunications regulator said on Thursday it has conditionally approved Rogers Communications Inc's acquisition of Shaw Communications Inc's broadcasting services, as the C$20 billion ($16 billion) mega deal for Shaw announced last year clears a major regulatory hurdle.
The Canadian Radio-television and Telecommunications Commission (CRTC) laid out a number of modifications to the deal - including a proposal that requires Rogers to contribute $27 million in "initiatives that will benefit the broadcasting system".
The takeover deal, announced in March last year, would make Rogers the second-largest cellular and cable operator in Canada as a result of the acquisition.
The company is also expected to gain from Shaw's strong presence in the sparsely populated regions of Western Canada, which would also help it increase its efforts to roll out 5G throughout the country.
To address competition concerns, Rogers would be required to double down on its efforts to support local news, the CRTC said. The company must produce 48 news specials each year that reflect local communities, and employ a "higher" number of journalists at its Citytv stations, the regulator said.
Rogers would also be required to distribute at least 45 independent English and French-language services on each of its cable and satellite services, the regulator said.
Shaw's other businesses - home telephone, wireless and Internet services - that Rogers is also seeking to acquire are not subject to CRTC's approval and are being reviewed by the Competition Bureau and Innovation, Science and Economic Development Canada, the regulator said.
($1 = C$1.2559) (Reporting by Niket Nishant in Bengaluru; Editing by Shailesh Kuber)