News
Telco boosts its presence in Western Canada, will rebrand its Manitoba operations accordingly; announces sale of mobile customers to Telus.
BCE, parent company of Bell Canada, on Monday announced it has brokered a deal to acquire 100% of regional mobile and Internet services provider Manitoba Telecom Services (MTS).
The transaction is worth around C$3.9 billion (€2.7 billion), comprising $3.1 billion in cash and stock and the assumption of $800 million in net debt.
"Welcoming MTS to the Bell group of companies opens new opportunities for unprecedented broadband communications investment, innovation and growth for urban and rural Manitoba locations alike," said BCE and Bell Canada CEO George Cope, in a statement.
"Bell is excited to be part of the clear growth opportunities in Manitoba, and we plan to contribute new communications infrastructure and technologies that deliver the latest wireless, Internet, TV and media services to residents and businesses throughout the province," he said.
Bell has pledged to invest C$1 billion in the five years post-completion to expand its broadband infrastructure and services in Manitoba. This will include boosting fibre availability, rolling out its Fibe TV service in the province, expanding its LTE network, and integrating MTS’s Winnipeg data centre with its own network of data and cloud computing centres.
Bell plans to retain the MTS brand. The combined company’s operations in Manitoba will be badged as Bell MTS, "in recognition of the powerful brand presence the MTS team has built across in the province," Bell said.
It added that MTS’s home, Winnipeg, will become its corporate headquarters in Western Canada, where it will have an employee base of 6,900 people, including MTS’s 2,700 staff.
The deal is subject to court, shareholder and regulatory approvals. Should it fail to close, BCE could be liable to pay a $120 million break-up fee to MTS, depending on circumstances. It expects the transaction to close towards the end of this year or early in 2017.
In a related transaction, doubtless designed to smooth the regulatory process, Bell announced that it will sell a third of MTS’s postpaid mobile customers and dealer locations to rival Telus.
"This transaction with Telus enhances wireless competition to the benefit of Manitobans while reducing the cost of our acquisition of MTS," Cope said.
The agreement with Telus is also subject to regulatory approvals. Bell was quick to point out that its MTS deal is not conditional on closing the deal with Telus.
