Telus approach for Mobilicity blocked for a second time

31 Oct 2013

Industry Canada, the federal ministry responsible for telecoms, has rejected Telus’ second attempt to purchase indebted cellco Mobilicity, the Globe and Mail reports. The newspaper says that a government spokesperson confirmed that it ‘provided a confidential answer to Mobilicity about a potential transaction’ that the financially struggling company was trying to complete while under court protection from its creditors. Although Industry Canada would not comment on the details of the response, other sources were quoted as confirming that the proposed transaction was overruled. A previous attempt by Telus to take over Mobilicity was blocked by the ministry under a frequency transfer policy which aims to prevent national incumbents gaining the 2100MHz/1700MHz wireless spectrum which new entrants obtained in the country’s 2008 AWS licence auction. In Mobilicity’s case, an embargo on purchasing this spectrum technically expires in February, although this does not guarantee it can be acquired by Telus or major rivals Rogers or Bell as the federal policy states that each proposed spectrum transfer must be examined individually. Meanwhile, Mobilicity’s ‘stay period’ during which it is shielded from legal action from creditors runs out on 20 December 2013.

‘Mobilicity sought views from Industry Canada on a potential spectrum licence transfer. Industry Canada considered this request under the Spectrum License Transfer Framework and provided a response in confidence,’ Industry Canada said in an e-mailed statement. Mobilicity’s outgoing president Stewart Lyons declined to comment, noting that ‘conversations with Industry Canada are private and ongoing,’ the Globe & Mail added.

Canada, Innovation, Science & Economic Development Canada, Mobilicity, Telus Corp (old), Telus Corporation, Telus Mobility (old)