The CEO of Canadian operator MTS Allstream has welcomed the government’s relaxation of foreign investment laws and says the company is assessing how to benefit from them.
“Now that we know exactly how the new rules apply, we are assessing how to…
The CEO of Canadian operator MTS Allstream has welcomed the government’s relaxation of foreign investment laws and says the company is assessing how to benefit from them.
“Now that we know exactly how the new rules apply, we are assessing how to capitalise on these changes in the best interests of the company and its stakeholders,” said CEO Pierre Blouin in the company’s Q2 earnings release.
MTS Allstream has two units: MTS and Allstream. Allstream serves business and has a substantial fibre network while MTS operates in Manitoba offering fixed and wireless services along with internet and TV.
In June, ahead of the proposed amendment to Canada’s foreign investment laws, it was reported that MTS Allstream had hired Morgan Stanley to sell Allstream to an international buyer.
Ronald Gruia, an analyst at Frost& Sullivan, questioned who would bid for Allstream although he suggested that AT&T may take an interest.
Now the bill has been passed, there is no limitation to the amount of foreign investment telcos with a market share of 10% or less can receive. Previously, foreign ownership for these firms was capped at 33.3%.
“We have advocated for this change over the past few years, as we believe it will drive more investment and greater innovation in Canada’s telecommunications sector,” said Blouin.
“This change could help strengthen Allstream, as it broadens available opportunities, including new sources of capital and stronger partnerships.”
Past media reports have estimated MTS Allstream could fetch a price of anywhere between US$400m and US$800m.
