Rogers Communications Inc. and Telus Corp. are vying to acquire Mobilicity, the Canadian wireless carrier currently in creditor protection, people familiar with the matter said.
The companies have made preliminary proposals to the federal government valuing Mobilicity at a minimum of C$300 million ($245 million), said the people, who asked not be identified because the information is confidential.
No formal deal has yet been submitted to the government and talks between Rogers, Telus and Mobilicity’s creditors could still fall apart, the people said. Any deal that is reached would need to be approved by the federal government and the bankruptcy courts.
Vancouver-based Telus is interested in Mobilicity, and is prepared to transfer some cellular airwaves to wireless operator Wind Mobile or to another new entrant, spokesman Shawn Hall said.
Allowing Rogers or Telus, two of Canada’s three biggest wireless carriers, to acquire Mobilicity would reverse previous government decisions to reject takeover attempts by Telus on the grounds that it would limit competition. Canada has been working for six years to encourage the creation of a fourth national carrier to bring down prices for wireless services.
Canada “will not approve any spectrum transfer request that decreases competition in the wireless sector,” Jake Enwright, a spokesman for Canadian Industry Minister James Moore, said Saturday in an e-mailed statement. Moore announced Friday he would not run in the next federal election in October due to family reasons.
Once firm bids have been received, the federal government could move quickly in approving or rejecting a transaction, the people said.
“We continue to be interested in acquiring Mobilicity,” Hall, the Telus spokesman, said Saturday in an e-mail.
Canada’s government has blocked multiple earlier attempts by Telus to buy Mobilicity’s assets. In April 2014, Mobilicity said it had reached an agreement to be acquired by Telus for about C$350 million.
Aaron Lazarus, a spokesman for Rogers, declined to comment on whether the carrier had submitted a proposal to buy Mobilicity or transfer spectrum after a potential acquisition.
Mobilicity continues to “pursue a going-concern transaction that is in the best interest of stakeholders and we continue to engage with a number of parties,” Joel Shaffer, a spokesman for the carrier, said in an e-mail Saturday. “We can’t comment on the specifics of any potential transaction or the actions of others.”
Mobilicity is the brand name of Data & Audio Visual Enterprises Wireless Inc., while Wind is the brand name of closely held Globalive Wireless Management Corp.
The Globe and Mail reported late Friday that Rogers and Telus were in the running to buy Mobilicity.