Catalyst Capital Group wants to merge WIND Mobile and Mobilicity

Ian Hardy

April 13, 2013 6:10pm

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WIND Mobile is up for sale. Mobilicity is currently in talks with TELUS for a possible acquisition. Public Mobile is also looking to exit and is seeking a buyer. The newer wireless players in Canada are certainly in a period of uncertainty and transition.

For years Tony Lacavera, WIND Mobile’s Chairman & CEO, has declared that “there’s room for one new national carrier.” This seems to be more true now than ever. WIND Mobile is leading the new entrant race with over 600,000 subscribers. Unfortunately Mobilicity and Public Mobile are private companies and their true subscriber numbers are not known.

Apart from a partnership between Naguib Sawiris’ Accelero Capital and Lacavera’s AAL Corp., Rogers and Telus are rumoured to be interested in picking up WIND Mobile. Now, another twist to this ongoing wireless is from Toronto-based Catalyst Capital Group. This private equity investment firm manages a portfolio of over $3 billion, owns a portion of Mobilicity’s outstanding bonds, and looks to be gunning for WIND Mobile. Apparently they specialize “in buying distressed assets such as debt” and the Globe and Mail is reporting that they have dreams of merging both WIND Mobile and Mobilicity, essentially creating a larger 4th national carrier. Newton Glassman, Managing Partner of The Catalyst Capital Group, is leading the charge, but declined to comment on his plans.

Christian Paradis, Minister of Industry, recently said that his strategy is to “build a more competitive wireless sector – one that delivers for Canadian families by providing more choices and more access at better prices.”

WINDcity.

Source: Globe

  • skullan

    Everyone wants to merge them. I’d agree with this, but not with a Telus take-over.

  • deltatux

    For the love of [insert deity here], just merge them together, it’s better than having any of the Big 3 in snatching them up. Of course I wish none of this has to happen, but if the market demands it, it might have to be done.

    What I see here is either: WIND gets picked up by Accelero and AAL Corp and runs by itself, or it gets picked up by Catalyst Capital Group and be merged into Mobilicity (unless they can license the WIND brand, I doubt it’ll be called WIND Mobile) or the last one no one wants to happen, one of the Big 3 snatches the new entrants and absorb the competition.

    Personally, merging Mobilicity and WIND might save both from oblivion. However, if Accelero and AAL Corp picks it up then Mobilicity may be in danger of getting killed off.

    As for Public Mobile, it has always been the ugly duckling ever since it was founded, it has a band that no one really wants and its network is not GSM-compatible which basically everyone else in Canada runs on. Public Mobile may just be stuck as a niche player or just collapses if no one picks them up.

    • Accophox

      I think in any given scenario, the likelihood of Mobilicity brand continuing to exist is nonexistent. Which… I’d loose no sleep over. I don’t think a Wind+Mobilicity merger will kill cheap pricing – as it’s the only incentive for people to switch over from the big 3 at this moment. Maybe in 10-15 years time if Wind ends up with a sizeable portion of the wireless market, but by then, who knows what will happen.

    • deltatux

      Here’s the thing, the chances it’ll be WIND is less than it be Mobilicity. Like I said above, unless they manage to secure the brand licensing, they cannot continue to call the new company WIND Mobile. It’ll likely be Mobilicity or a new name if they fail to do so.

    • Accophox

      I suppose that’s true. But who knows – Vimpelcom may be perfectly fine with licensing the WIND brand to whomever manages to snatch the company. Whether they use it or not, I do not know. Personally, I hate neon pink and green of mobilicity, and much prefer the orange and blue of Wind. ;)

      (Though, I’d be more okay if they switched colours to blue and orange and decide to use mobilicity.)

    • Plazmic Flame

      They will merge…. THEN one of the Big 3 will snatch them up… :(

  • HHco

    yes they need to merge!! we need competition in this country or else the big 3 will just rob us forever…..

  • Dula714

    I do not care who buys what, as long as there are better plans and reception.

  • Kern Lee

    its a good idea. both wind and mobi uses the same frequency bands so the most obvious benefit from merging is better reception and maybe coverage. plan rates and policies between the 2 are similar so merging shouldnt change that much. they’ll be the ultimate underdog competition

  • Thomas C. Riddell

    Please don’t let any of Big 3 Buy Wind There plans cost too much
    If anything I want to see T-Mobile Canada

    • Guest

      I agree I currently trying to figure weather to stay with wind or go to mobilicity or just throw in the towel give up my data and go straight to Chat-R be for the prices go up

    • Robert Chartier

      I to would like to see this option, but at the moment I am trying to decide weather to stay with wind ride out the storm or goto mobilicity now or give up my Data plan and goto Chat-R now well that is still an option. I know that mobilicity will benefit from winds network. and should they merge a rebranding of the new company once this is completed would be best as both companies have suffered from a rough start growing pains legal battles by the big three and fighting for scraps left over by the big three.

  • hoo dat

    ZOIKS!!!

  • Guyyyyyy

    yesssssssssssssssssssssssssssssssssss

  • Andrew K.

    This would be awesome. It would help to improve coverage as now customers would have access to more cell towers. Congestion wise, Mobilicity might just make it worse for customers on Wind, but with more towers, connections can be balanced more easily and prevent bottle necks and overcapacities.

    We’ll call them: Wind Mobilicity

    • Conception

      Windmocity for the win!

  • Ren596

    A merger seems to be the only way to keep compition alive in Canada

  • Truthbetold

    I’m hopeful that Wind and Mobi can merge and be a major fourth carrier. Also I want Public Mobile just staying small and becoming the fifth brand keeping all carriers in check and prices competitive. This is a dream scenario. With the new wireless bands going up for sale soon its going to be hard for these small carriers to keep competing.

    What will likely and actually happen is that WIND will likely get picked up by the AAL Corp and remain competitive. WIND has a shot because they have subscribers and continuing to grow. Mobi will likely get bought out by another carrier, likely Telus or Rogers. Public Mobile will just fold, but someone will buy them just for the spectrum they hold and hog it (Rogers). Sigh….

    Either way, Canadians are going to lose out big time in the next couple of years. The last few years actually brought out some competition. But Canadians still pay the highest prices and have the longest contracts compared to others. Its downhill from here boys and girls.

  • Sweet

    Wind and Mobilicity got together last year to talk about merging, but they couldn’t agree on their valuations. Hopefully the injection of a third party into the discussions will overcome that hurdle.

    IMO, it would be better if Vidéotron bought Wind or Mobilicity, since Vidéotron have relatively deep pockets and it would provide true national coverage. However, I fear Vidéotron would just end up acting just like the Big 3.

  • NJ

    Two cats can never make a tiger, the biased authorities are destroying the competition for the big three, the market is going to be monopolized, or I call it tripolized, by the three big ones again, thanks to CRTC and CWTA

    • kffa

      yea but 2 cats better then one :)) , plus who knows they make lil ones to help around ( side joke )

  • JerryBolton

    MOBI+WIND merger = since they both use the same spectrums, consolidate the 3G/HSPA onto one and fire up some LTE action on the other? One can dream. Either way, consumers need a fourth option or the big3 will just gouge unabated.

  • Andrew McInally

    “Rogers and Telus are rumoured to be interested in picking up WIND Mobile”

    I’d rather see Rogers die as a company first. At least Wind gives flat rate and cheap mobile data. No other cell provider does.

    • Ren596

      Part of me agrees with that, BUT the Blue Jays FAN in me Does NOT

  • Darth Paton

    If Telus or Rogers bought out Wind Mobile, they would most likely jack up rate plan prices, add on extra fees and abolish unlimited data before eventually shutting down Wind and merging it with the Telus/Rogers brand. That would be a terrible day for the Canadian Telecom Industry.

    • Dee

      This would be so true as that is what happened to Fido when bought out by Rogers, first the long distance/roaming fees were hiked to equal that of Rogers; additional charges were added and then the plans all changed – service was crappy too during the takeover (speaking from experience)

  • Khristopher Ranger

    I think they should merge, but not with one of the big 3 as a buyer. They should just form a new company.

  • Dave

    This is good news plus they will also be getting the iphone soon as reported earlier this week. This would be a win win situation for everyone. Let these two companies give the big three a run for there money. Go for it Catalyst Capital Group this would be the greatest decision you’ll ever make!! :) :) :)

    • Robert Chartier

      you know I think you all need to watch the movie other people’s money to get a better understanding of what goes on when a company debt is acquired .Wind has a better frame work for it’s network as they have a year jump on mobilicity as they had an extra year to get there network up and running . if all the other mobile companys like the ones that are only in one province Quebec and MTS in Manitoba and Saska-Tel in saskachawan were to merge with wind and mobilicity and get a us cell companies like T-mobile we would have a coast to competitor that could give the big 3 a real fight and with the addtional of a us backer like T-mobile they could really make a fight of it and much like attom in the movie Real Steel kick a little Ro-bell-us a*s.

  • David Church

    I don’t understand the concern over what a Wind and Mobilicity merger would be named. Renaming and relaunching advertising would likely bring more consumer attention.

    Telus was the new name for the merger of AGT and BC Tel. When they bought Clearness Clearnet (remember the last group of new wireless companies?) they dropped the Clearness Clearnet name but adopted it’s strong brand recognition and distinctive marketing (corporate graphic standards, animals in TV commercials) across all Telus market segments. Rogers Wireless was once Cantel .

    The name really doesn’t matter as long as it is properly focus group tested.

    • Ren596

      Actually the Company Name was Clearnet

    • David Church

      Thanks. i pecked that out on my phone and didn’t notice that auto-correct changed Clearnet to Clearness (I’m not sure that Clearness is a real word either.)

  • Eddisonlane

    Whoever buys Mobilicity I’ll be okay as long as they don’t f##k with my plan.

  • Yeria

    I hope they merge.. I think at this point, the best option is for them to grow to compete against the Big 3. They can also call themselves Windicity.

    • Todo

      Windicity sounds cool to nerds like us, but to an average person it will be a weird, unappealing name. Re-naming and re-branding won’t be too difficult, really.

  • Chris

    Will be part of it or wont? Hoping you meant not going to be part of Telus..

  • Cormang

    Let’s hope this is true. We desperately need a 4th carrier. All you have to do is take a look at a Rogers, Bell, Telus package and compare it to one of the small players. If they merged their subscribers then they could possibly blanket a few more cities in Canada with coverage.

  • PT

    “build a more competitive wireless sector – one that delivers for
    Canadian families by providing more choices and more access at better
    prices.”

    “A scumbag and a half. Waste of tax payer dollars.

  • hoo dat

    Anyone with the inside track on what’s going on in the negotiations between Telus and Mobilicity is hardly going to be blabbing about it on Mobile Syrup. And they’d also have a better grasp of English grammar than that exhibited above.

  • Zany

    This is the best of a bad situation. The best situation would be that Wind and Mobilicity could be highly successful and would drain off a few million subscribers from the big three and hopefully that would cause some kind of corporate attitude adjustment and then maybe they would treat people as people and not like something they stepped in. Oh the joy of the oligopoly and wireless barons that rule them. Hopefully someday, their stranglehold will end and we can look back and laugh at how often they lied to us on the phone because you would think that it is illegal to do that.

  • Sweet

    It’s been more than a month since the Mobilicity store by my place has been selling Wind plans and phones. I figured it was a sign of things to come. :-)

  • T. James

    I wish this doesn’t happen. Why would wind need or want to be absorbed and disappear into RoBuLus?
    Every time RoBuLus (Rogers Bell Telus) absorbs a small player we the consumer lose out. They immediately do away with affordable plans and screw us. If wind can offer a province wide unlimited talk plan for $20-25, why can’t RoBuLus?! I refuse to get into a contract with RoBuLus.
    When Telus sucked up Clearnet, they screwed me out of my plan. The same thing happens every time. They are thieves!
    If Christian Paradis wants to see affordable cell plans, he needs look no further than Wind mobile, then compare them to RoBuLus. He’ll see how the big 3 are SCREWING Canadians.

  • Gnolaum

    Seems reasonable. Just make certain that you fire Wind’s customer service department; and use Mobilicities.

  • WireNow

    From what we understand Public has the lowest debt out of the three. I believe Mobilicity also has good financials. Wind, on the other hand, has a huge debt. Also their corporate culture has demonstrated anything but a responsible attitude to both their employees and their customers. Mobilicity and Public have the greatest value. The alternative to those two is like buying a ghost or facade of a company.

  • Robert Chartier

    that would be great if they got one of the us cellular service providers to go in with them like sprint or preferably T-mobile

  • Konrad

    Realistically, if any of them gets purchased by the big three – the other will instantaneously gain a ton of new customers. If you prefer Wind over Mobiliticy or vice-versa, I think most most people that chose the smaller entrant it was due to cost will be happy to switch to the other to avoid Big3 rates.

    I also hope for a WIND-I-CITY (pronounced “Wind-ee-city”) :), only because Wind has wider coverage, but I want to keep my amazing Mobi plan!

    Also – if they could merge and gain in size, maybe they can partner up with a US company (T-Mobile) and provide an inexpensive US/Canada Data/talk plan.