Industry Canada rejects second Mobilicity buyout bid by TELUS

MobilicityThere is more bad news for Mobilicity today. The Globe and Mail has learned that Industry Canada has again rejected a bid for Mobilicity to be bought out. While it was known that Mobilicity was talking to the Canadian government about a potential buyout, the identity of the buyer has not been revealed. It is believed to be none other than TELUS, which already made a CA$380 million bid earlier this year only to see it rejected by the government.

In fact, it appears that no formal bid was presented to the government but that Mobilicity was looking for a “informal, non-binding assessment” on a potential sale to TELUS.

While no reason has yet to be given for the rejection, The Globe and Mail reports that it has once again to do with enforcing a ban over the transfer of wireless licenses from the so-called new-entrant carriers to incumbents.

For its part, TELUS last week received approval from Industry Canada to buy out Public Mobile, another struggling carrier. Public Mobile uses G-block spectrum which Industry Canada describes as “of a significantly lesser value than other types of spectrum.”

It remains to be seen what next steps Mobilicity will take. It remains under protection from creditors under Canada’s Companies’ Creditors Arrangement Act (CCAA) until December 20. It still has over 180,000 subscribers but numbers are falling as the company struggles to remain in operation.

Source : The Globe and Mail