Canadian mobile VoIP provider Fongo has announced that it plans to table a bid to take over cellular network operator Globalive Wireless (Wind Mobile), although the proposed offer – a token one dollar purchase price plus a 49% stake in Fongo’s business – has been dismissed as a publicity stunt by industry analysts quoted in the media, while a Wind spokesperson appeared to pour scorn on the idea. Simon Lockie, Wind’s chief regulatory officer, took to Twitter to comment: ‘I hereby publicly offer to buy Fongo for a dollar and half my sandwich. Hopefully the story gets picked up before I get too hungry to deliver.’
Fongo offers cheap VoIP calls and messaging via mobile users’ existing 3G/4G data plans and over Wi-Fi connections, including calls to mobiles, landlines and other Fongo phone numbers; its Fongo-to-Fongo free calling network covers over 85% of Canada including 30 of the largest metropolitan areas in all ten provinces. Users may also port an existing mobile or landline phone number to Fongo for a CAD25 (USD24.60) one-time fee. Fongo said its takeover plan involves migrating Wind subscribers to Fongo’s IP calling services ‘within a year’. It claims that over the last twelve months more than a quarter of a million users in Canada have signed up for its VoIP services, accessible via a mobile app. The Financial Post writes that Fongo has publicly disclosed CAD1.7 million in venture capital investment from Tech Capital Partners and angel investors and also received a repayable loan of up to CAD850,000 from FedDev Ontario in November 2012 for research and development of the next phase of its mobile service. However, the supposed takeover target Wind is estimated to be valued at roughly CAD750 million, with its 2100MHz wireless spectrum alone costing CAD442 million in 2008, while it has over 600,000 subscribers.
It was recently reported that Wind’s parent group Vimpelcom is putting the cellco up for sale while it waits for approval of a deal to take overall control of its shares; Wind’s Canadian founder Anthony Lacavera and original financial backer Naguib Sawiris are tipped to buy back the company.