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WIND Mobile Founder Considers Buying Mobilicity if Verizon Not Interested

The founder of WIND Mobile, CEO and chairman Anthony Lacavera, says his AAL Group is interested in looking at Mobilicity now that Verizon has reportedly delayed its plans to acquire the wireless entrant startups, revealed last night by the Globe and Mail.

The Canadian Press reports Lacavera says regardless of who acquires WIND, it is destined to become the fourth national carrier in Canada:

Lacavera, who owns a 35 per cent stake in Wind Mobile, says no matter who buys Wind, it will become Canada’s fourth national carrier.

He also says he believes Verizon is keeping all doors open until it has to put down a deposit on Sept. 17 to participate in the spectrum auction in January.

Lacavera says if Verizon takes part in the spectrum auction it could set up a wireless business on its own in Canada without acquiring Wind Mobile or Mobilicity.

TELUS had previously tried to acquired Mobilicity, which has continued to bleed money, but the deal was rejected by the Federal Government, citing “spectrum set aside for new entrants was not intended to be transferred to incumbents.”

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  • ????Dennis

    I don’t give a fuck who buys what…. Just give us a solid competitor to the big 3 and we will flock to you in droves!

  • Chrome262

    I can see Verizon doing things on their own and save 700 million, but seems like a lot of work. And I think for Wind in general getting mobilicity could be good.

  • kkritsilas

    I don’t know how real this is. Does WInd even have say $300M to buy out Mobilicity? Even if they did, how will this impact WInd’s ability to buy 700 MHz spectrum licenses? I don’t know how it would break down for Verizon to go it on their own (i.e. develop an entire network on their own) vs. buying out Wind/Mobilicity. In some ways, it would be a clean slate beginning, nothing existing to prevent/impede a ppure 700Mhz LTE network from the ground up (i.e. no existing customer base, lease arrangements, etc.). On the other hand, revenue would be zero unitl such time as Verizon could roll out at least a network in the major centers, whereas buying WInd/Mobilicity could generate a revenue stream from the existing customer base immediately. The other part is, if Verizon does announce that they will be biidding on the 700MHz spectrum, it is likely that Wind or WInd/Wind-Mobilicity will not get any 700MHz spectrum blocks, in which case, I think that Wind/Wind-Mobilicity may end up going under long term, allowing Verizon, or any of the Big 3 to buy them. The other possibility is that Verizon bids, and gets the 700MHz block that it wants, and Wind or Wind-Mobilicity are shut out of the bidding because the Big3 get the remaining 3 blocks. Wind/WInd-Mobilicity’v value would decline to a small fraction of what it is now, allowing them to be bought for a very low price. Good way for Verizon to enter Canada at a mniimal price.

    Kostas

  • Al

    “Does WInd even have say $300M to buy out Mobilicity”

    It’s not Wind’s money. It’s the rich guy who is thinking of buying them back.

  • Al

    More & more, I’m thinking that the value isn’t there with regard to buying Wind, and Verizon is thinking of starting fresh. Just my guess, though. But Verizon would already have towers near the border, which are deliberately running under-power in their northward-facing range. They just have to flip the switch and they have instant coverage of the border region of most of Canada, and the great lakes. It’s just a small dent, but it’s still a ton of money they don’t have to spend, and Wind towers that are currently covering parts of that area may be redundant. My point being… they may be thinking why spend the money?

  • kkritsilas

    That’s essentially who I was talking about. Vimpelcom doesn’t seem to be inclined to invest in Canada. I personally doubt that LaCavarra has the capital to do it, and Sawaris would need to buy Wind back and then buy Mobilicity on top of that (call it $1B for both). On top of that, 700MHz spectrum licensing fees will be expensive, and money is needed for either network expansion, or to pay out to the Big 3 for carrying out Wind’s/WInd-Mobilicty’s traffic.Wind’s debt load probably won’t allow debt financing for both a Mobilicity buy out and bidding on 700MHz spectrum. I don’t see any individual investor with that amount of cash available, so you are talking about a big international carrier. It wouldn’t need to be Verizon, I’m sure that China Telecom could do it, as could AT&T, Orange, Vodafone, Telefonica, and probably a lot of others if they were so inclined. Point is, this is going to be a capital intensive business to get into, and the only player that seems to have made any indication at all that it is interested. I think they are playing this the way I described to minimize the purchase price.

    Kostas

  • 1His_Nibs1

    Well I’m not sure what all is entailed in building from the ground up but Verizon has already stated that if they were to purchase WIND that they’d replace all of Huawei’s equipment (currently being used by WIND) so either way passing on WIND or starting from scratch there’s an automatic cost they’d incur. I guess then all they need to do is build towers with the exception of the ones already in place along the border. Considering Verizon has deep pockets and they’re 4x larger than the big 3 combined I guess it really could go either way.

  • MapleHoney

    Wind can barely hold itself together right now. Getting Mobilicity might not be a good thing as both companies might go down together if not done carefully.

  • Westben

    Simply put, Wind has 600k subscribers and 1,400 cell towers in place (Lower Mainland/Edmonton/Calgary/Lower Ontario-Montreal corridor. Verizon would look at them as 320~450 million wholesale purchase of infrastructure, and consider cost of customer acquisition at 200 per, so 700 million is maybe 100-200 million more than a fire sale, or wait for the day Wind can’t afford to dump any more money into it and get it for 350M