Globalive strikes network deal with Telus to boost chances of buying Freedom

This is the first time a Canadian operator has entered into network and spectrum sharing with an independent wireless rival, but subject to freedom

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Globalive has signed a network and spectrum sharing agreement with Telus Communications Inc. as it sets the stage for an uncertain, unconsummated bid to acquire Freedom Mobile, Shaw Communications Inc.’s valued wireless unit. of up to $4 billion that’s on the block as Shaw attempts to complete a merger with rival telecommunications giant Rogers Communication Inc.

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Globalive said its deal with Telus marked the first time a Canadian carrier had entered into network and spectrum sharing with an independent wireless competitor, but was “conditional on Globalive’s successful acquisition of Freedom Mobile.”

Anthony Lacavera, the founder of Globalive, has stated publicly and repeatedly that a competitive wireless market with lower prices for consumers depends on the assets of Freedom – formerly owned by Globalive and operated under the Wind Mobile banner – in the hands of a pure-playing a wireless operator rather than an incumbent in telecommunications.

In addition to Lacavera’s group, Freedom’s assets have attracted interest from Montreal-based Quebecor Inc. and Xplornet Communications Inc., a rural broadband service provider owned by the private equity firm. Stonepeak Infrastructure Partners, based in New York.

According to media reports, Lacavera is unhappy with the way Rogers handled the Freedom Mobile sale process and suggested that Globalive was pushed out.

The sale process was turned upside down earlier this month when the federal Competition Bureau formally opposed the $26 billion merger of Rogers and Shaw. In documents filed with the Competition Tribunal, the Commissioner of Competition said the “remedy” offered by Rogers and Shaw was not enough to allay his fears that competition would be lessened to the detriment of Canadian consumers.

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The filing argued that Freedom had shaken up the wireless landscape dominated by Rogers, Telus and Bell, and lowered prices for consumers where it operated.

Rogers said he would continue talks with the Competition Bureau while formally responding to the filing with his arguments to be weighed by the court, but nevertheless pledged to sell Freedom “in its entirety.”

In a Thursday press release, Globalive said that “long-term network and spectrum sharing is essential for the stability of the fourth player” to ensure that competition remains in the wireless market amid the latest upheaval, making the most efficient use of the scarce and finite spectrum.

“Industry newcomers committed to lower wireless rates have historically struggled to build networks that can sufficiently compete with the incumbents’ 25-year lead,” the statement said.

“This transformational agreement would enable Globalive to not only provide consumers with lower prices and innovative offerings, but also to deliver equivalent network quality, establishing a vigorously competitive environment for decades to come.”

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