SaskTel commissions risk assessment due to Bell’s big MTS purchase


Following Bell’s purchase of Manitoba Telecom Services (MTS) announced three days ago, regional carrier Sasktel has confirmed it is going to undertake a risk assessment to look in to the potential impact on its business.

SaskTel is a crown corporation—a designation shared by liquor stores, for example—and is now in the vulnerable position of being the only remaining regional carrier in western Canada.

Jim Reiter, the minister responsible for Saskatchewan telecommunications, told the Saskatoon StarPhoenix: “This is going to make us essentially an island in Western Canada.”

Reiter said the report should be completed within the next few weeks, and will lay out what risks Bell’s purchase of MTS could entail for the regional provider.

“Hypothetically, I guess if it says minimal impact, minimal reaction,” Reiter told the StarPhoenix, “If there’s considerable impact, we’re going to evaluate it at that time.”

No matter what, Reiter assured, the government will not privatize the crown corporation like it did with 40 provincial liquor stores in late 2015.

“We’ve been abundantly clear where we’re at with that, about going to the people, about respecting the intent of the (Crown Protection Act),” he said.

If SaskTel were up for sale, it might be valued at approximately $2 billion, according to Frontier Centre for Public Policy’s 2013 study.

On May 2, Bell announced its purchase of MTS for $3.9 billion, which is expected to close late 2016/early 2017. At that time Bell also announced that it would be investing $1 billion in regional infrastructure over the next five years, as well as opening a headquarters in Manitoba.

Even before the sale condensed the options available in Western Canada, 49 percent of Manitobans felt there wasn’t enough competition in the wireless industry, according to a study by Angus Reid.

Related reading: SaskTel and Videotron change plans in response to price increases from the Big Three

[source]Saskatoon StarPhoenix[/source]