Wind Mobile's cellular application was approved by Industry Canada in March. Their ownership structure was scrutinized at the time and deemed to be acceptable. Wind Mobile, in partnership with Egypt's Orascom, were set to launch Canada's next and fourth national carrier network until the CRTC got their regulatory claws into the deal. The CRTC took issue with Orascom's foreign investment and on October 29th denied Globalive's cellular application.
Now Globalive is obviously trying to come up with an alternate solution which would be acceptable to the CRTC. In the absense of a deal Bell and Rogers have both stated that they would be interested in the spectrum. Bell's statement is as follows:
"if the spectrum is to be forfeited and returned to industry Canada... Industry Canada will then re-auction the returned spectrum.... Bell Canada is prepared buy up to 50% of it for up to 50% of the price paid by Globalive"
50% of the price paid by Globalive. That's it !! Globalive was ready to launch. Bell, Telus and Rogers file a complaint with the CRTC and request further investigation into Globalive's investment structure. The application is denied and now Bell is ready to pay up to 50% of the price paid by Globalive.
And then last Thursday after a speech at the Toronto Board of Trade Rogers CEO Nadir Mohamed stated the following:
"Spectrum is a very valuable asset. 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."
We're missing a few more public declarations - Telus will of course throw their hat into the ring, and then maybe (here's hoping) Shaw and Videotron might also bid for the spectrum. Shaw had an agreement (collusion really) with Rogers not to compete in each other's territories. Shaw agreed not to compete in Ontario & Quebec, and Rogers in the West. That agreement is now over, and Shaw is now entering the Ontario market with the acquisition of Mountain Cablevision of Hamilton. If the Globalive spectrum goes up for auction then I'm sure there will be some active bidding with the end price being probably higher then the original $442 Million paid by Globalive in the first place.
Actually, if their spectrum went back to auction the entire process would be a sham. Globalive paid, and Industry Canada accepted the money with full disclosure of the Globalive ownership structure. The Minister of Industry Tony Clement should come to Globalive's rescue, and quick.