WIND Mobile founder leads Vimpelcom share of WIND Mobile acquisition

WIND Mobile

VimpelCom, the telecommunication conglomerate that owns a large portion of WIND Mobile has finally found a buyer for the Canadian carrier it has been trying to sell. Citing sources familiar with the matter, The Globe and Mail has learned that WIND Mobile’s founder, Tony Lacavera, will buy out buy out the Dutch-based company with the backing of a number of financial backers including Canadian hedge fund West Face Capital and U.S.-based Tennenbaum Capital Partners. The transaction is valued at about CA$300 million with just over half of that being WIND debt that the new owners will assume.

The deal, expected to be announced tomorrow, is also expected to bring new capital investment. This will allow WIND Mobile not only make improvements to its network but likely also participate in the upcoming AWS-3 spectrum auction in early 2015. Before that can happen though, the deal will need to be approved by the Competition Bureau as well as Industry Canada.

The other investors are LG Capital Investors, Serruya Private Equity and Novus Wireless Communications.

VimpelCom picked up its stake in WIND Mobile when it acquired Orascom back in 2011. Citing “challenges the Company is facing in the country”, namely uncertainty over the government’s strategy over foreign ownership in the wireless sector, VimpelCom earlier this year wrote down its investment in the Canadian carrier down to zero and decided not to fund WIND Mobile’s participation in the last spectrum auction.

The CA$300 million price tag for the WIND Mobile acquisition suggests that anyone looking to buy Mobility, a smaller rival with far fewer subscribers and less valuable spectrum, will be able to do so for much less. Mobilicity has been under creditor protection for nearly a year and the only deal that appears to have come up, an acquisition by TELUS Mobility, was repeatedly shot down by Industry Canada.

Source : The Globe and Mail