UPDATE 2-Shaw Communications eyes wireless in C$1.6 bln Wind Mobile bid

Wed Dec 16, 2015 8:27pm EST
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(Adds executive interview, source comment, background on Canada's wireless industry)

By Julie Gordon and Alastair Sharp

VANCOUVER/TORONTO Dec 16 (Reuters) - Canada's Shaw Communications Inc said on Wednesday it has agreed to buy Wind Mobile, the country's fourth-largest wireless provider, in a deal that gives it a much-needed presence in the cellular market.

Calgary-based Shaw said the deal valued Wind, and its parent company Mid-Bowline Group Corp, at C$1.6 billion ($1.16 billion), much higher than the roughly C$300 million a consortium of investors paid for the young wireless carrier in 2014.

The takeover follows Rogers Communications Inc's C$465-million purchase of smaller rival Mobilicity, which was in creditor protection, in a series of deals that allowed Wind to snap up a suite of airwaves at a discount price.

Shaw had bought spectrum that was set aside for new entrants to the wireless industry in 2008, but never built out that capacity. Shaw formally sold those airwaves to Rogers as part of the Mobilicity deal in June, with Rogers then passing on most of those plus some other airwaves to Wind to secure regulatory approval.

In taking over Wind, Shaw now not only will regain most of the spectrum it sold at a profit, but will enter Canada's hotly contested wireless market with an established cellular presence.

"The way the asset has come together with the various deals, there was no choice to be made," said Jay Mehr, Shaw's chief operating officer. "This was absolutely the best way to enter the Canadian wireless market."

Mehr said the company does not anticipate any "meaningful regulatory barriers" to the deal, despite a history of the Canadian government blocking telecommunication deals for competitive reasons.   Continued...