Wind sells Manitoba, Sask. AWS spectrum

Wind Mobile has sold its AWS spectrum in Manitoba and Saskatchewan to Saskatchewan Telecommunications Holding Corp. and Manitoba Telecom Services Inc., stating the company plans to focus on the Ontario, B.C. and Alberta markets. Industry Canada said on its website Friday that it has approved the transfer of the spectrum licences, which Wind recently acquired from Rogers Communications Inc. after Rogers’ purchase of spectrum Shaw Communications Inc. bought in the 2008 AWS auction. SeaBoard Group analyst Iain Grant noted in an email that Wind is under “new ownership and management now.” Wind CEO Alek Krstajic was appointed CEO in March, six months after Wind was bought out from majority owner, Dutch-based VimpelCom Ltd., in a $285-million deal, by former CEO and current honorary chairman Anthony Lacavera's Globalive Capital. “The new leadership is more focused on key markets rather than a ‘national dream’,” Grant said. In a joint press release with SaskTel, Wind added that the agreement would allow it to “focus resources on providing strong competition and LTE rollout in Ontario, British Columbia and Alberta.” Wind CEO Alek Krstajic said a joint release with MTS that the proceeds from the sale “will be used towards network expansion and quality improvements including the LTE rollout." MTS will pay $45 million, “financed using existing credit facilities which it plans to repay following the sale of Allstream,” for 15 MHz of paired AWS-1 spectrum, it said in the release. SaskTel said it would purchase two blocks of spectrum, but did not disclose the price. SaskTel spokeswoman Michelle Englot said in an email the company was still in the process of finalizing its agreement with Wind, “so we are unable to provide specifics regarding the agreement such as purchase price at this time.” SaskTel CEO Ron Styles stated in the release that the company’s LTE network in Saskatchewan’s nine major urban centres “operates on the AWS-1 spectrum band and with these additional blocks we can deliver significantly more bandwidth and faster speeds.” MTS Allstream CEO Jay Forbes said in its release that the “deal is great news for our Manitoban customers as the use of mobile video increases.” Cannacord Genuity analyst Sanford Lee said in a research note Friday that the price MTS paid includes a 37 per cent premium on the price Shaw originally paid for the spectrum, though it’s a 17 per cent discount on “the implied $2.25 per MHz PoP combined value paid by Rogers for Mobilicity and Shaw's AWS-1 spectrum.” “We believe that this is an appropriate discount, given that Rogers' acquisitions included major urban markets in Ontario, British Columbia and Alberta,” he said. Lee said that the deal makes it clear Wind has chosen not to enter Manitoba, but that “the market widely assumed that had no plans to enter the province anyway.” He said some may conclude that by approving this deal, following its OK of Rogers’ acquisition of Mobilicity and of Shaw's spectrum, “Industry Canada has opened the door for a potential acquisition” of MTS by BCE Inc., Telus Corp. or Rogers. Lee said he doesn’t agree with that interpretation, since the government would block any such attempt due to concerns about spectrum concentration. On its website Friday, Industry Canada noted the deal involved “spectrum that is not currently being used to provide services.” It added the transfers “will not significantly change the post-transfer concentration of commercial mobile spectrum in the affected licence areas” and that they will not affect the ability of potential competitors to provide service in the two provinces. Lee said that an acquisition of MTS by Bell, Telus, or Rogers would result in a wireless provider with a 57 to 84 per cent wireless share in Manitoba. “We do not believe that this would be in the interest of the government or Manitobans and would be inconsistent with the government's policies to promote wireless competition,” he said. — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Shruti Shekar at sshekar@thewirereport.ca.

Wind sells Manitoba, Sask. AWS spectrum

News | July 31, 2015

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Wind sells Manitoba, Sask. AWS spectrum

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