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TELUS Acquires Mobilicity For $380 Million In The Midst Of Financial Challenges

Running a cellular network is an expensive business, and taking on the Big 3 – Bell, Rogers and TELUS has been more work than expected for the “new carriers” that entered the Canadian.  After spending $243 million in the spectrum auction, Dave Wireless was born which shortly was renamed to Mobilicity, but very quickly experienced a number of changes such as Dave Dobbin stepped down and was replaced by Stewart Lyons as the new CEO.  Then the future of Mobilicity Knight In Shining Armorwas in question as rumours of the company being for sale started to surface.  Fortunately with its 250,00 customer base, a “knight in shining armor,” has swooped in as TELUS has agreed to acquire the struggling Mobilicity for $380 million.  The agreement is still subject to approval from the Competition Bureau, Industry Canada, and Mobilicity’s debtholders.

“A concern for our customers and employees led us to approach TELUS, which has a reputation for a strong customer focus, as evidenced by their industry leading client loyalty,” said Stewart Lyons, Mobilicity President. “I am confident TELUS will look after our employees and our customers, mitigating any disruption to their service, while offering the best outcome for all stakeholders.”

William Aziz, Mobilicity Chief Restructuring Officer, continued, “Mobilicity has been losing a significant amount of money every month. The financial strength of TELUS will allow the business to be continued in a way that will benefit customers and employees. An acquisition by TELUS is the best alternative for Mobilicity.”

The entire purchase price will be used to satisfy Mobilicity’s secured and unsecured debt. If this deal is approved, TELUS will retain all 150 Mobilicity employees as it integrates the Mobilicity operation into TELUS over the coming months.