Xplornet Explores IPO, Sources Say

Bloomberg reports that Canadian rural broadband specialist Xplornet Communications is working with Bank of Montreal and Royal Bank of Canada on an initial public offering (IPO) planned for this year, according to anonymous sources with knowledge of the matter who added that the New Brunswick-based fixed-wireless ISP has not yet decided on the stake size or price range. In May Xplornet’s management expressed the desire to examine new ways to continue growing, including a potential IPO, after revealing existing investors had put roughly CAD1 billion (USD758 million) into the company over the past decade.

Thanks to TeleGeography for the article.

Xplornet Acquires Calgary WiMAX Operator Platinum

Canadian nationwide rural fixed-wireless broadband provider Xplornet Communications has agreed to acquire 100% of Calgary-based WiMAX network operator Platinum Communications for CAD0.16 (USD0.12) per share in cash. Platinum operates a wireless broadband network offering internet and digital phone services to residents and businesses across the province of Alberta, catering primarily to rural and near-urban areas that are often beyond the reach of traditional (fixed) internet providers. Bernard Parkinson, CEO of Platinum, stated: ‘Based upon the current industry pressures in the wireless internet services provider industry and after actively reviewing the options available to the shareholders of Platinum, we believe this transaction offers attractive value and presents an excellent opportunity for Platinum’s shareholders.’ The takeover has been unanimously approved by the board of directors of Platinum, while completion of the transaction is subject to standard termination provisions and customary closing conditions including receipt of court approval, approval (at least two-thirds) of Platinum’s shareholders, and necessary regulatory approvals. Voting will take place at a special shareholders meeting in late-October 2015, with closing anticipated to occur shortly thereafter.

Thanks to TeleGeography for the article.

Feds Study Telus, Rogers Bids for Mobilicity; Founder Proposes Alternative MVNO Strategy

Canada’s two largest mobile operators by users, Rogers and Telus, have recently tabled takeover offers for financially struggling smaller cellco Mobilicity, although any potential deal is subject to federal government approval under strict wireless spectrum transfer rules aimed at preserving competition, the Financial Post reports. According to sources quoted by the paper, a group of creditors and directors of Mobilicity met over the weekend to assess offers from both national operators exceeding the previous CAD350 million (USD285 million) offer from Telus rejected last year by Industry Canada under the spectrum transfer rules designed to prevent nationwide incumbents gaining smaller competitors’ 3G/4G frequencies. Telus spokesperson Shawn Hall confirmed that the company remains interested in purchasing Mobilicity and put forth a proposed transaction to Industry Canada for review, while talks remain ongoing and confidential, with Rogers currently unwilling to comment. A key part of a potential deal would involve agreeing a free-of-cost transfer of Mobilicity’s AWS-1 frequencies to mid-tier cellco Wind Mobile post-purchase to circumvent the government’s competition-guarding policy. Telus confirmed that its latest proposal includes this free-transfer clause, and although this idea has previously been rejected by Industry Canada, there could be federal backing for a move bolstering Wind’s position following March’s AWS-3 spectrum auction in which Wind raised its profile against nationwide players Rogers, Telus and Bell by winning set-aside licences in Ontario, Alberta and British Columbia for minimal prices after Mobilicity failed to find the funding to participate. So far, the government is remaining opaque on the latest prospects for a deal, with Minister of Industry James Moore’s press secretary Jake Enwright saying on Sunday: ‘We’ve had a clear position on these types of transactions for some time. We’ll not approve spectrum transfer requests that decrease competition in the wireless sector.’

Meanwhile, a separate proposal has been aired by Mobilicity founder John Bitove – backed by his holding company Obelysk – and a group of Mobilicity employees who have made an offer to Industry Canada to become a mobile virtual network operator (MVNO). Mobilicity itself is not involved in the MVNO bid.

Mobilicity has around 157,000 remaining subscribers and a network of around 450 3G cell sites in Toronto, Vancouver, Edmonton, Calgary and Ottawa, operating under court-sanctioned creditor protection since September 2013 as it continues to seek an optimal exit strategy for creditors and investors.

Thanks to TeleGeography for the article. 

Rogers’ Q1 Mobile, Internet Gains Make up for TV, Landline Declines

Canadian quadruple-play operator Rogers Communications reports that its consolidated revenue increased 5% year-on-year in the first quarter of 2015 to CAD3.175 billion (USD2.599 billion), reflecting revenue growth of 4% in Wireless, 1% in Cable, and 26% in Media, with stable revenue in Business Solutions. Wireless turnover increased as a result of higher network revenue from the continued movement of customers to LTE, and the adoption of higher average revenue per user (ARPU) generating ‘Share Everything’ plans, as well as greater smartphone sales. Cable revenue was relatively stable as continued internet revenue growth was offset by decreased revenue from pay-TV and residential fixed line telephony.

Thanks to TeleGeography for the article.

SaskTel Announces Investment Budget, Annual Financial Results

Canadian regional operator SaskTel will invest CAD313 million (USD249 million) in CAPEX in Saskatchewan province in 2015, with CAD177 million dollars being allocated towards its core Saskatchewan network, while CAD45 million is earmarked for its fibre-to-the-premises (FTTP) network (‘infiNET’) to connect 18,000 additional fibre homes in Regina, Saskatoon, Moose Jaw, Prince Albert and Swift Current. In 2015, SaskTel will invest CAD37.8 million in wireless network enhancements, including CAD18.2 million for 3G W-CDMA/HSPA+ (marketed as ‘4G’) and CAD14.6 million for 4G LTE expansion.

SaskTel adds in its newly published annual report that 59% of its mobile customers had LTE capable devices at end-2014, up by 30 percentage points in a year, while just 13% had CDMA devices, down by seven percentage points. The telco posted annual revenues in 2014 of CAD1.231 billion, up from CAD1.206 billion the previous year, driven by wireless, IPTV (‘maxTV’), internet and data services which offset the ongoing decline in traditional wireline services. Annual net profit fell to CAD76.4 million from CAD90.7 million due to continued investment in networks, the report noted.

Thanks to TeleGeography for the article.

Bell Canada Service Revenues Climb 2.2% In Q4

Quadruple-play operator Bell Canada’s total revenues grew 2.6% year-on-year to CAD4.940 billion (USD3.946 billion) in Q4 2014 on 2.2% higher service revenues, reflecting a strong increase in wireless (Bell Mobility) turnover and positive overall fixed network division growth. Product revenues grew 6.8% over Q4 2013, reflecting more wireless device upgrades and increased business data equipment sales, while quarterly Bell Media revenues declined 3.9% y-o-y. Adjusted EBITDA in Q4 was up 2.2% to CAD1.730 billion, driven by increases of 10.6% in wireless and 2.0% in wireline operations, moderated by a 16.5% decline at Bell Media, due to higher costs for sports TV rights and content investments for Bell’s new ‘CraveTV’ on-demand video streaming service. Bell’s consolidated EBITDA margin in Q4 2014 was 35.0% compared to 35.2% in Q4 2013.

For full-year 2014 Bell Canada’s operating revenues and EBITDA were up 3.5% and 3.7%, respectively, to CAD18.734 billion and CAD7.066 billion, driven by the increased contribution of wireless, TV, internet and media. Total revenues generated by these four service areas grew by CAD814 million, or 5.5%, in 2014. Bell Canada’s CAPEX for the year increased by 4.7% to CAD3.142 billion, supporting the continued deployment of broadband fibre to homes and businesses to expand its IPTV footprint and enable faster internet speeds; the continuing rollout of 4G LTE mobile service in markets across Canada; higher spending on network capacity to support increasing internet bandwidth usage and mobile data consumption; and enhancements to customer service delivery systems.

In FY 2014 Bell’s wireless revenues increased 6.7% to CAD6.241 billion underpinned by annual service revenues growing 6.4% to CAD5.705 billion and product revenues up 11.8% to CAD483 million, while adjusted wireless EBITDA grew 9.6% to CAD2.564 billion in the year. Total Bell mobile customers grew 2.5% to 7,970,702, and post-paid customers represented 88% of this total at the end of 2014, compared to 86% one year earlier. Including sister company Bell Aliant, total wireless customers grew 2.4% in 2014 to 8,118,628. Blended ARPU increased 5.5% to CAD61.12 in Q4 2014, representing the 20th consecutive quarter of year-on-year improvement. Growth was driven by accelerating data usage on Bell’s expanding 4G LTE network (reaching 86% of the population) as the proportion of smartphone users continued to increase, and the favourable impact of two-year contract pricing introduced in 2013 following implementation of the federal Wireless Code of Conduct.

Bell Canada reported 2,287,489 fixed broadband internet customers at the end of 2014, a 4.7% increase over 2013. Including Bell Aliant, the Bell Canada Enterprises (BCE) group had 3,297,026 fixed broadband subscribers at that date, up 5.1% y-o-y. Wireline data revenues were up 4.0% to CAD1.573 billion in Q4 2014, the result of combined internet and TV service revenue growth of 5.1%, and growth in IP broadband connectivity and business service solutions of approximately 3% and 10%, respectively. The Bell ‘Fibe TV’ IPTV footprint reached more than five million households at the end of 2014, compared to approximately 4.3 million at the end of 2013. Including Bell Aliant’s ‘FibreOP’ service area, BCE’s total IPTV footprint now covers six million homes, up from 5.1 million at end-2013.

Thanks to TeleGeography for the article.

Cogeco’s Fiscal First-Quarter Canadian Revenues Climb 1.8%

Fiscal 2015 first-quarter revenue at cableco Cogeco’s Canadian division increased by 1.8% year-on-year to reach CAD315.2 million (USD263.5 million) in the three months ended 30 November 2014, attributable to a rate increase implemented in April 2014 in Quebec and Ontario, alongside customer base growth. Operating expenses in the quarter remained virtually level y-o-y at CAD155.4 million, as additional marketing initiatives related to the launch of TiVo digital advanced TV services in early November in Ontario were offset by cost reduction initiatives and restructuring activities in fiscal 2014. Fiscal 2015 first-quarter adjusted EBITDA amounted to CAD159.8 million, or 3.6% higher than in the same period of the prior year, mainly as a result of revenue growth exceeding operating expenses; consequently, operating margin increased from 49.9% to 50.7%. In September-November 2014 Cogeco Canada lost a net 7,479 TV customers to give it a total of 789,686; cable telephony subscribers were also reduced, by 553 to 468,720; broadband internet connections climbed by 13,327 in the three-month period to 692,911.

Thanks to TeleGeography for the article.

BCE, Rogers to Jointly Own Glentel Retail Network

Rogers Communications has reached an agreement with rival telecoms group BCE under which the two companies will jointly own Glentel’s Canadian retail distribution outlets once the pending acquisition of Glentel by BCE is completed. As part of the agreement, Rogers will withdraw its recently filed court application for an injunction against the takeover, pending closure of the agreement with BCE. A press release indicated that the deal ensures customers across Canada will continue to be offered wireless products and services from a choice of telecoms network operator at Glentel’s 494 retail locations across Canada (which are run under names including WirelessWave, Tbooth wireless, Wireless Etc and Target Mobile).

Thank to TeleGeography for the article. 

The Good, the Bandwidth and the Ugly: BCE Buys Phone Retailer, Passes 1m FibreOP Premises, Hit With Civil Suit

Bell Canada Enterprises (BCE) has agreed a CAD594 million (USD520 million) cash-and-stock deal to buy independent cellphone retailer Glentel, the Globe & Mail reports. The deal will give Bell ownership of Glentel’s roughly 500 own-brand retail locations in Canada, as well as kiosks at Target Canada and Costco under the names ‘Wirelesswave’, ‘Tbooth wireless’ and ‘Wireless etc’. BCE previously bought another phone retail chain, The Source, with around 750 locations, in 2009. The Source now exclusively sells BCE-owned wireless products, but the Glentel outlets will continue to distribute rivals’ products, at least for the time being.

In other news, BCE’s Atlantic Canada-based division Bell Aliant has announced reaching its end-year target of making its fibre-to-the-home (FTTH) ‘FibreOP’ broadband services available to one million homes and businesses, with the milestone deployment of the millionth premise passed achieved in Oromocto, New Brunswick, it said in a press release. Bell Aliant simultaneously announced a free FibreOP internet speed upgrade – the third in the last two years. On 7 December 2014 the 50Mbps/30Mbps (down/upload) package is raised to 75Mbps/30Mbps and the 80Mbps/30Mbps package jumps to 150Mbps/30Mbps, while the top speeds available are boosted significantly from 250Mbps/30Mbps to 400Mbps/350Mbps. In addition, in a recently announced partnership with its sister Bell Media division, Bell Aliant will also offer a new subscription on-demand video streaming service, code named ‘Project Latte’ focusing on premium TV content.

Elsewhere, CBC News reports that an Ontario court has certified class action lawsuits against Bell and rival Telus over the practice of rounding up calls to the farthest minute whilst not immediately disclosing the method to certain customers. The class actions were certified on behalf of Canadian residents who subscribed to Bell services and were billed by the minute between August 2006 and October 2009, and Ontario residents who subscribed to Telus services and were billed per-minute between August 2006 and July 2010.

Thanks to TeleGeography for the article.

Mobilicity Down But Still Not Out; Catalyst Frustrated in Attempts to Influence Cellco

Indebted Canadian cellco Mobilicity has received its eighth court-sanctioned extension to its creditor protection, from 1 December 2014 until 30 January 2015, while it continues to seek a buyer for its business, the Globe & Mail reports. In its latest court filing Mobilicity reported 154,900 active subscribers at 31 October, down by 1,400 since August, Canadian website MobileSyrup noted, as the struggling operator continues to compete via discount offers and promotions. The court document also disclosed that Mobilicity has ‘been engaged in discussions with several parties who have expressed interest in advancing a transaction.’ Mobilicity had CAD415 million (USD368 million) in long-term debt as of 31 March, but this week’s filings state it is currently operating on a ‘cash flow break-even basis’.

Meanwhile this week Mobilicity’s largest bondholder Catalyst Capital stated it is willing to contribute funding towards Mobilicity bidding in Industry Canada’s AWS-3 mobile spectrum auction set to take place in March 2015, with a preliminary deadline for bid applications of 30 January 2015. The Globe & Mail writes that Catalyst told the court of its CAD400 million financing plan, of which it was willing to advance up to CAD300 million, although the Toronto-based fund admitted that few direct discussions have taken place with Mobilicity, while it has received little specific feedback on its proposals. Catalyst was excluded from an additional round of financing involving other debtholders last year and has complained of being shut out of discussions with other parties regarding potential deals with Mobilicity. Furthermore, whilst granting Mobilicity’s latest creditor protection period, the Ontario Court of Justice rejected a request from Catalyst for a court-ordered meeting with the cellco.

Thanks to TeleGeograpy for the article.