Debt-ridden Canadian operator Mobilicity has reportedly secured the required financing to take in part in the country’s upcoming spectrum auction, due to kick off on 3 March.
The company has reached a C$65m (US$52.4m) debtor-in-possession financing…
Debt-ridden Canadian operator Mobilicity has reportedly secured the required financing to take in part in the country’s upcoming spectrum auction, due to kick off on 3 March.
The company has reached a C$65m (US$52.4m) debtor-in-possession financing deal with some of the company’s existing debt holders, pending court approval, according to The Globe and Mail citing an affidavit by the carrier’s chief restructuring officer William Aziz.
Last week, the telco, which has been under creditor protection since September 2013, said that it had failed to reach an agreement with third parties and existing creditors to secure the required C$62m deposit, due by 30 January, to bid in the upcoming AWS-3 auction.
The Canadian government has set aside 60% of the spectrum available in the auction for smaller players and new entrants. Mobilicity and Wind Mobile are the only two players that qualify to bid on those set-aside licences in Ontario, British Columbia and Alberta.
Mobilicity, which had 158,600 subscribers as of 31 December 2014, has asked the Ontario Superior Court of Justice for a further extension of the stay period of proceedings until 8 May, in order to have enough time to review its strategic options based on the auction results.
The company has however decided to opt out of the 2,500 MHz auction, planned for April, which does not set aside spectrum for new entrants.
Canada’s conservative government has had a policy over recent years of promoting competition in the Canadian mobile market to challenge the dominance of the big three operators: Bell Canada, Rogers, and Telus.
However, critics of its fourth-carrier policy have argued that it puts off foreign investments and impose restrictions which are detrimental to a free-market economy.
Mobilicity was not immediately available for comment.
