Canada’s Mobilicity is once again at the centre of takeover speculation.
This time it is weighing up two offers from its larger rivals, one from Telus and the other from Rogers Communications, according a report on Sunday by the Globe and Mail, and the paper claims it is under mounting pressure to broker a deal.
Telus and Rogers have both submitted proposed transactions to the government for review, the paper said, and indications are that either offer could find favour with the state.
However, an unnamed source said that if the telco does not reach agreement with one of the would-be buyers in the next couple of weeks, the government could push it back until after October’s election, by which time the valuations and identities of the bidders could have changed considerably, the paper said.
Struggling Mobilicity has been operating under court protection for the best part of two years and has been seeking a buyer for even longer. The telco has been unable to compete effectively in a mobile market dominated by the big three: Telus, Rogers and Bell Canada.
Previous takeover attempts have been blocked by the government, which is keen to foster more competition via a stronger fourth player, but this time one of the big guns could get the green light to snap up Mobilicity, the Globe and Mail said.
Telus’ offer reportedly includes the transfer of some of Mobilicity’s spectrum to another small operator – Wind Mobile.
Spectrum has been a sticking point for the government, since Mobilicity uses airwaves that were specifically set aside for market newcomers and Ottawa is determined that they should not be transferred to one of the big three.
The Globe and Mail secured confirmations from Telus and Mobilicity that negotiations are taking place, but the other telcos declined to comment.
