October 1, 2014 / 10:09 PM / 4 years ago

Bell Aliant agrees to lease network to close Ontera deal

TORONTO (Reuters) - Bell Aliant Inc BA.TO, a regional telecom company in eastern Canada, agreed to lease access to part of its landline network to rival Bragg Communications Inc [BCOMU.UL] in order to win approval for an acquisition, the country’s competition watchdog said on Wednesday.

Bell Aliant agreed to a 20-year lease with Bragg’s Eastlink covering much of the remote footprint of O.N. Tel Inc, known as Ontera, the federal Competition Bureau said in a statement.

The watchdog had expressed concerns the deal would create a monopoly and lessen competition, given Bell Aliant and Ontera own and operate the only two telecom networks connecting 16 remote Ontario communities.

The Ontario government agreed to sell Ontera, the communications arm of the provincial Ontario Northland Transportation Commission, to Bell Aliant for C$6 million ($5.37 million) in cash in April.

Bell Aliant is itself in the process of being acquired by its biggest shareholder, BCE Inc (BCE.TO), for C$3.9 billion.

The related issue of forcing established operators to share wireless infrastructure at regulated costs is the subject of an ongoing hearing at the country’s telecom regulator.

Reporting by Alastair Sharp; Editing by Diane Craft

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