Quebecor Selling Media Assets to Fund Wireless Plans, Possible Stake in WIND Mobile: Analyst
Parent company of Videotron, Quebecor, has long stated it will only expand its wireless ambitions if the federal government intervenes to set caps on wholesale wireless roaming rates. Until conditions are met, the company continues to mull expansion plans outside Quebec.
Quebecor also will be selling its struggling media business to Toronto’s Postmedia for $316 million in cash. The purpose of this cash? According to Barclays analyst Phillip Huang, he believes it will be used to fund future wireless spectrum purchases or even an ownership stake in WIND Mobile (echoing previous reports from last month), according to The Star:
Barclays’ Phillip Huang said the Montreal-based communications conglomerate may be building a war chest to help fund wireless growth across Canada, though he said in a note that Quebecor is “keeping its powder dry” until all the right conditions are in place.
He said the company’s capital requirement driver may be opportunities in the fast growing wireless sector in and outside Quebec.
At last week’s CRTC hearings on the wireless wholesale industry, Quebecor said favourable wholesale rates from the Big 3 would allow the company to offer “top-notch mobile services” to Canadians. Current wholesale rates paid to the Big 3 are not just for actual network costs, but include other costs bundled in such as equipment subsidies, marketing, customer service and more.
Last month, WIND Mobile confirmed it had talks with Quebecor, but CEO Anthony Lacavera said no plans for any deal would be happening anytime soon.