Rogers eyes Globalive spectrum
Last Updated: Friday, November 13, 2009 | 06:49 PM EST
Financial Post
TORONTO -- Nadir Mohamed, chief executive of Rogers Communications Inc., the largest wireless carrier in Canada, is interested in acquiring spectrum from Globalive Wireless Management Corp., if the startup is unable to launch.
“Spectrum is a very valuable asset,” Mr. Mohamed said Friday after a speech to the Toronto Board of Trade. “It’s the real-estate of our business, so Rogers would be for sure interested in picking it up. I’m sure others would be.”
Globalive paid $442-million for airwave licences from Ottawa during last year’s federal auction that would allow the Toronto company to offer cellphone services across the country and compete against Rogers as well as Telus Corp. and BCE Inc.’s Bell Canada.
Globalive planned to launch in Toronto and Calgary as early as this month. However, it was stopped in its tracks after the national telecommunications regulator ruled on Oct. 29 that the firm was controlled by its foreign backer, Egyptian carrier Orascom Telecom Holding SAE.
National telecom rules dictate cellphone carriers be demonstrably controlled by Canadians.
Orascom has provided some $508-million in loans for Globalive -- much of which used to pay for spectrum -- and also owns 65% of the domestic carrier’s equity.
The equity stake is within the rules because Globalive’s voting shares are controlled by its Canadian chairman, Anthony Lacavera. But the combined economic stake gave Orascom an unacceptable level of influence, the CRTC found.
Globalive may still appeal to Industry Minister Tony Clement to overturn the ruling, which went against Industry Canada’s decision in March that the firm was in fact Canadian controlled.
In his speech, Mr. Mohamed said not having Globalive in the market would not mean less competition, noting that two other startups, DAVE Wireless Inc. and Public Mobile were preparing to launch by early next year while established cable giants Shaw Communications and Quebecor’s Videotron were readying their own plans.
In an earlier interview with the Financial Post, Globalive’s Mr. Lacavera said none of the other newcomers to wireless could provide the scale his firm could and that the ruling, if it stands, would keep choice for consumers restricted in several markets.
Financial Post
jasturgeon@nationalpost.com
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