UPDATE 1-Canada delays Wind Mobile deals on security concerns -report

Fri Jun 14, 2013 3:43pm EDT
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By Alastair Sharp

TORONTO, June 14 (Reuters) - National security concerns have delayed the Canadian government's approval of two deals that would solidify Vimpelcom Ltd's ownership of wireless carrier Wind Mobile, a Canadian newspaper reported on Friday, citing unnamed sources.

Vimpelcom, a telecommunications company that is Wind's largest shareholder, has been trying for months to take control of Toronto-based Wind after Canadian investment rules were changed to allow foreign ownership of smaller telecom companies.

However, Canadian officials wary of giving control of Wind's infrastructure to an entity with strong ties to Russia have hampered the closing of the deals, the Globe and Mail reported on Friday, citing multiple unnamed sources.

Vimpelcom's top shareholder is Moscow-based Altimo, a company controlled by billionaire Mikhail Fridman, whom Forbes magazine ranks as the second-richest man in Russia.

Amsterdam-based Vimpelcom has said Wind Mobile is not a part of its core business, suggesting it is open to divesting the wireless company once it has gained full ownership.

The Canadian government said in an email to Reuters that the strict confidentiality provisions of the Investment Canada Act precluded it from addressing the report, but that it "is clearly committed to encouraging competition in the wireless sector."

Canada's wireless industry is dominated by Telus Corp , BCE Inc's Bell unit and Rogers Communications , each of which has more than 7 million customers. Wind has about 600,000.   Continued...