A couple days ago WIND Mobile announced its parent company, Orascom, would gain 99.3% control of the company and become Canada’s first foreign-owned wireless carrier. The moves comes as WIND Mobile CEO Anthony Lacavera sells his portion of the company to Orascom, and will step down as CEO but continue as an honorary chair.
Does Orascom plan to sell WIND Mobile? According to their industry sources, The Globe and Mail reports Orascom has considered numerous options for its Canadian investment, with one of them being a sale to an existing wireless incumbent, which would be counterintuitive to the federal government’s plan to open up Canada’s wireless industry.
Orascom is reportedly “anxious” to cut its losses in Canada (they said to have ‘regretted’ entering the Canadian wireless market) and looks to sell WIND Mobile to either Bell, TELUS or Rogers, with the latter cited as the most frequently mentioned buyer:
Despite speculation that Mr. Lacavera’s departure from Wind would forge a path to an eventual merger with rival newcomer Mobilicity, industry sources suggest that Wind’s foreign financial backers are anxious to cut their losses and sell their Canadian assets. Sources say that merger talks with Mobilicity have recently run cold as Amsterdam-based VimpelCom Ltd., the majority owner of Orascom, mulls a possible sale of Wind to a Canadian incumbent. Rogers Communications Inc. is the name most often floated as the potential buyer.
WIND’s merger talks with Mobilicity have fizzled because “everybody thinks their company’s worth a lot…nobody can ever agree on valuation” said a source familiar with discussions.
It was just last week Rogers and Shaw announced a $700 million cable deal which included a $50 million purchase option of Shaw’s unused AWS spectrum, purchased in 2009. The source says the close proximity of both announcements is not a coincidence.
The CEO of VimpelCom (Orascom’s parent company), Jo Olav Lunder, was recently asked at an investor day about its Canadian investment and said they are still deciding its future.
[via The Globe and Mail]
