Anthony Lacavera, founder and CEO of the company-turned-Freedom Mobile, is improving its bid for wireless business by collaborating with Telus on a network sharing agreement.
The fate of Freedom Mobile Wireless is the central issue blocking Rogers’ $26 billion acquisition of Shaw after the Competition Bureau took to court last week to block the deal.
The bureau said Rogers proposed a certain divestiture of Shaw’s wireless assets, but it did not go far enough to prevent a sharp decline in competition in the cellular market.
While Pierre-Karl Péladeau’s Quebecor has emerged as a potential lead candidate for the asset, La Cavira said he hopes the arrangement with Telus will prove a financially sensible proposition and benefit Canadian wireless customers.
“This puts us in a position to check every square for the government and Rogers,” LaCavira said in an interview with The Star, adding, “I think this agreement puts us on a level playing field with Kibecourt.”
La Cavira’s investment firm Globalive Capital has offered $3.75 billion to buy Freedom Mobile, an offer he said is still standing. He said it is backed by a group of mostly US investors including Twin Point Capital and Baupost Group.
LaCavera said his group has been speaking with Rogers, but Globalive refused to sign a nondisclosure agreement to join an earlier process to look into potential buyers of Shaw’s wireless assets.
Globalive announced the agreement with Telus Thursday morning and La Cavira said that if his bid was successful, Freedom Mobile and Telus would be able to share network infrastructure, such as cell towers. They can also combine the spectrum – the airwaves that carry radio signals – in the areas where Freedom operates.
“Think of (the Spectrum) as a highway,” he said. “Telus has a six-lane highway, Freedom has a three-lane highway. Put them together there’s a nine-lane highway, and now all customers benefit from that nine-lane highway.”
Freedom Mobile, which offers services in Ontario, British Columbia and Alberta, has helped lower wireless rates and spur the introduction of consumer-friendly features like unlimited data.
La Cavira and his associates founded Wind Mobile in 2008, and after a number of organizational and operational setbacks, Shaw bought the company in 2016 and later renamed it Freedom Mobile.
Calgary-based Rogers’ Shaw announced its landmark deal in March 2021, after years of speculation that the two companies would pool their cable assets.
The Canadian Radio, Television and Communications Commission (CRTC) has agreed to transfer Shaw’s broadcasting assets to Rogers, but the deal still requires approval from the Federal Innovation Administration and the Competition Bureau, both of which focus on how the deal will impact. Wireless market.
The Bureau is seeking an injunction that would temporarily prevent Rogers and Shaw from closing their deal. The competition court has scheduled a hearing on the matter for June 29-30. Rogers and Shaw must submit their responses to the Bureau of the injunction by the end of May.
The competition bureau said it was still open to settling its court case to block the merger, but indicated in legal filings that it wanted a buyer of wireless assets with enough cash and enough operating experience to keep pressure on the Big Three, Rogers, Tellus and Bell.
The bureau further said that connecting wireless service to the Internet and home television was important, but La Cavira downplayed their importance.
An independent wireless operator could be just as competitive, he said, citing the example of TMobile in the United States, which has not traditionally operated a home Internet or TV business.
Telus spokesman Richard Gilhuly did not provide any further details about the agreement, but said the company had long offered network access to organizations “looking to gain mass access to network services at wholesale rates.”
“The network sharing agreement announced today will allow Globalive to expand its network reach and coverage if it is the successful treatment partner for Freedom Mobile as part of the proposed merger between Rogers and Shaw,” Gilhuly said.
Globalive has not disclosed the economic terms of its agreement with Telus, which also has a separate network sharing agreement with Bell.
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