Court gives Mobilicity until December 20th to find a buyer

Mobilcity, who recently received creditor protection, has been given a bit more time to restructure and find a buyer.

According to a report in the Globe and Mail, Justice Frank Newbould of the Ontario Superior Court of Canada has granted an extended “stay period” for the struggling wireless carrier. The original date was set to expire on October 30th, but now Mobilicity has until December 20th to “secure the federal government’s approval for a proposed sale.” Apparently a buyer is interested in purchasing its assets and the rumours are that TELUS is once again considering making a bid. Mobilicity declined to comment on the identity of the potential suitor, but its lawyer, Orestes Pasparakis, stated “those discussions are continuing… they are very active and very dynamic.”

Back in June, Industry Canada denied TELUS’ $380-million bid to purchase Mobilicity and its spectrum. Its main objection was that the “proposed spectrum transfers that result in undue spectrum concentration – and therefore diminish competition…[it]will not be permitted.” The Globe’s sources say a way that a deal between TELUS and Mobilicity could succeed is to give TELUS a “put” right that will allow them to exercise a spectrum transfer at a later date.

In addition, John Bitove, Mobilicity’s Executive Chairman, has already committed to bidding in the upcoming 700Mhz spectrum auction, along with Mobilicity’s primary debt holder, Catalyst Capital – an entity who is also rumoured to be looking at purchasing the struggling carrier.

Mobilicity currently has around 200,000 wireless subscribers.

Source: Globe and Mail