Verizon delays Canadian carrier acquisition

Verizon Wireless

It appears that one potential suitor for the beleaguered Canadian carriers Mobilicity and WIND Mobile has decided to hold off an acquisition for now. According to The Globe and Mail, Verizon Wireless has decided to delay its plans to enter the Canadian market by acquiring one or both smaller Canadian carriers. According to “two people familiar with the situation,” the carrier has put its plans on ice until Canada’s 700MHz spectrum auction wraps up.

According to the report, Verizon will first decide whether to participate in the auction itself. Should it enter and win the spectrum it wants, it would then make a bid for either WIND Mobile or Mobilicity or even both.

What happens next could well depend on two key dates: Carriers who want to participate in the auction have until September 17th to apply and put down their refundable deposit. At that point, prospective buyers will not be able to negotiate with other bidders until next year. The auction itself kicks off on January 14th, 2014. It remains to be seen if we see Verizon on the list of bidders for the auction.

It’s not clear what prompted Verizon’s change of plans. While likely welcome news for the Canadian incumbent carriers, it is unlikely to be anything but bad news for WIND Mobile and Mobilicity which are both looking for a buyer. It remains to be seen if another suitor will step in to acquire either. One name being mentioned lately is Birch Hill Equity Partners Management Inc.  which could make a bid with funding from Rogers Wireless.

It remains to be seen whether WIND Mobile or Mobilicity can survive on their own until such time as Verizon is ready to begin talks again.

Source : The Globe and Mail