Rogers and Telus bidding for Mobilicity purchase

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Two of Canada’s largest carriers are bidding for a takeover of Mobilicity, which has been under court-ordered creditor protection since 2013. According to the Globe and Mail, Rogers and Telus are in the running to purchase the wireless provider for more than $300 million.

Mobilicity has faced significant losses as well as a 37 per cent drop in subscriptions in just the last two years. It now employs just 50 people across Canada.

This is the second attempted takeover of the company since 2013 when Mobilicity agreed to the terms of Telus’ $350 million purchase. At the time, the provider had 250,000 subscribers and 150 employees.

However, the first attempted acquisition by Telus was blocked by the federal government over new spectrum transfer conditions. Industry Canada cited Telus’ ambitions to takeover the valuable spectrum, not Mobilicity’s customers.

With the latest proposal by Telus, some of Mobilicity’s spectrum could be transferred to Wind Mobile Corp., which recently made major competitive headway with successful spectrum acquisitions in key markets in British Columbia, Alberta and Southern Ontario.

The question remains whether the government would approve the new Telus acquisition plan. For the benefit of Canadian consumers, it could theoretically increase the competitiveness of Wind.

Aside from the likely cost, the potential terms of a Rogers acquisition are not known.

 

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