Mobilicity Reportedly in Talks with Verizon to be Acquired
After postponing the debtholder vote twice, Mobilicity has finally confirmed this Wednesday that it is in talks with Verizon Wireless and other parties regarding a potential acquisition, both the Globe and Mail and Reuters report.
The wireless startup has been struggling to reserve a place in the Canadian wireless market, but Catalyst Capital Group co-founder Newton Glassman said it failed because on its own it is “only a flea on an elephant’s butt of wireless telecom” in the country.
According to a press release signed by the company’s CEO Stewart Lyons, the company is working “diligently to reach an acquisition agreement”.
“We are working diligently to reach an acquisition agreement and thank our customers, dealers, employees and partners for their continued support as we see this process through to its completion, Vaughn, Ont.-based Mobilicity’s president and chief operating officer Stewart Lyons said.
As we have previously pointed out, Verizon is allegedly readying its re-entrance into the Canadian wireless market. The first move was a bid for Wind Mobile, the biggest of the three wireless startups, with more than 600,000 subscribers.
The news was applauded by Mobilicity debtholders, and the company reacted immediately by opening talks with the major US carrier for a possible takeover. Catalyst owns roughly 30% of the struggling Mobilicity’s debt, but considering the wireless player’s aforementioned position on the elephant’s body, a Wind Mobile–Mobilicity merger under the Verizon umbrella could make sense, spiced up by the US carrier’s bid for spectrum in the upcoming spectrum auction.