Page 1 of 4 1 2 3 4 LastLast
Results 1 to 15 of 54

Thread: Mobilicity seeking financing for auction; seeking credit extension until May 2015

  1. #1
    Join Date
    Oct 2012
    Posts
    210
    Carrier(s)
    Koodo Mobile
    Feedback Score
    0

    Mobilicity seeking financing for auction; seeking credit extension until May 2015

    http://www.theglobeandmail.com/repor...rticle22581703

    January 22, 2015
    Mobilicity still seeking financing for possible spectrum bid
    By CHRISTINE DOBBYTELECOM REPORTER
    Cash-strapped wireless carrier asks court for another stay of legal proceedings against it

    Mobilicity says it has not yet secured the financial backing it needs to take part in an upcoming auction of wireless airwaves.

    The deadline for applications to participate in the public auction of spectrum in the AWS-3 (advanced wireless services) frequency band is Jan. 30 and if the startup mobile carrier were to bid in all of the regions where it currently operates, it would need to come up with about $62-million for a refundable deposit by that time.

    Mobilicity, which has been under creditor protection since September, 2013, said in court materials filed Thursday it has sought funding from existing creditors as well as third-party sources but so far has been unable to secure financing to participate in the auction.

    The company says it is continuing to consider funding options and could still potentially take part in the auction, which begins March 3.

    The auction has been structured to favour operating new entrants, such as Mobilicity and Wind Mobile, which operate in Ontario, British Columbia and Alberta, as well as Videotron Ltd. in Quebec and Eastlink Wireless in the Maritimes.

    Sixty per cent of the AWS-3 airwaves are set aside for new entrants. If Mobilicity does not participate and Wind does, Wind could acquire the licences in Ontario, B.C. and Alberta for the opening bid price of $62.5-million.

    Jan. 30 is also the deadline for another auction, to be held in April, for airwaves in the 2,500-megahertz frequency band. However, Mobilicity said in its filing Thursday it does not plan to bid in that auction, which does not have a set-aside for new entrants.

    Industry Canada discourages wireless players from publicly discussing auction strategy and Wind Mobile has not formally said it will take part in the auctions.

    However, the company's CEO Pietro Cordova said in December that Wind – which is owned by a consortium of Canadian and U.S. backers that struck a deal to acquire it in September – is evaluating various paths it could take to secure more spectrum, the valuable airwaves used to carry cellular signals.

    "We have many options [for spectrum] but they all fall into a few categories: You participate in an auction; you buy existing spectrum from people that are either under-utilizing it or not using it at all; or you partner up with people who have spectrum but maybe need Wind to pursue a different strategy," Mr. Cordova said in a Dec. 16 interview.

    Mobilicity is asking the Ontario Superior Court of Justice for another stay of legal proceedings against it, requesting an extension from Jan. 30 to May 8.

    The company also said Thursday that while it has continued discussions with various parties over possible sale, merger or financing transactions, it has not been able to conclude an agreement.

    William Aziz, the company's chief restructuring officer, said in an affidavit he is optimistic that by May 8, after the two spectrum auctions have concluded, "the wireless spectrum landscape will have materially changed and [Mobilicity's] transaction options may be materially different than they are today."

    While the auctions are ongoing, he noted, potential transaction partners will be focused on the bidding process and in some cases the auction rules will bar the parties from holding discussions around possible deals.

    Mobilicity has tried to sell to Telus Corp. on multiple occasions, but Industry Canada blocked the transactions and has said it will not approve deals that lead to an undue concentration of cellular spectrum in the hands of Canada's incumbent national carriers.

    The company acquired spectrum licences in the AWS-1 band in a 2008 auction for $243-million and those licences remain Mobilicity's main asset, although they have proven difficult to sell due to Ottawa's policy.

    The company said it is operating on a "cash flow break-even basis" and its customer base remains stable. It had 158,637 active users as of Dec. 31.

    A spokesman for Mobilicity declined to comment further Thursday.
    MCCANS

  2. #2
    Join Date
    Oct 2012
    Posts
    210
    Carrier(s)
    Koodo Mobile
    Feedback Score
    0
    "William Aziz, the company's chief restructuring officer, said in an affidavit he is optimistic that by May 8, after the two spectrum auctions have concluded, "the wireless spectrum landscape will have materially changed and [Mobilicity's] transaction options may be materially different than they are today."

    Anyone understand what he is referring to here? How can the landscape "change".

  3. #3
    Join Date
    Feb 2013
    Posts
    764
    Device(s)
    Nexus 6
    Carrier(s)
    WIND Mobile
    Feedback Score
    0
    Don't know about you guys, but I think this whole thing is fast becoming a joke now . . .
    I think the principals in Mobi just don't like WIND Mobile.
    Oh well, we'll see . . . nothing we can do about this anyway.
    John <><

  4. #4
    Join Date
    Apr 2011
    Location
    Toronto
    Posts
    2,132
    Device(s)
    BlackBerry Key2
    Carrier(s)
    Bell Mobility
    Feedback Score
    0
    This seems to be an indication that no-one has stepped forward with a serious or acceptable offer for the company; which begs the question: If no-one else wants it, why is Mobilicity so determined to push itself deeper and deeper into debt? It's already deep enough in trouble for them to be in creditor protection for almost 15 months still with no solution to their issues found. What makes management believe they have the skills and abilities to save themselves when people like Anthony Booth are still employed there?

    I want Mobilicity to survive but this whole thing has me incredulous at what appears on the surface at least to be complete and utter ineptitude.

  5. #5
    Join Date
    Oct 2012
    Posts
    210
    Carrier(s)
    Koodo Mobile
    Feedback Score
    0
    How much money are their creditors losing? LOL

    Sent from my Z30 using HowardForums

  6. #6
    Join Date
    Feb 2013
    Posts
    764
    Device(s)
    Nexus 6
    Carrier(s)
    WIND Mobile
    Feedback Score
    0
    Is it a done deal that an extension to creditor protection will be / has been granted?
    If not, when will we know?
    Is it possible that a judge / court looks at the whole situation and says "enough is enough"?

  7. #7
    Join Date
    Apr 2011
    Location
    Toronto
    Posts
    2,132
    Device(s)
    BlackBerry Key2
    Carrier(s)
    Bell Mobility
    Feedback Score
    0
    Quote Originally Posted by underrated View Post
    Is it a done deal that an extension to creditor protection will be / has been granted?
    If not, when will we know?
    Is it possible that a judge / court looks at the whole situation and says "enough is enough"?
    I have no idea what's going to happen regarding the creditor protection, but you've got to think that the creditors' further funding is contingent on getting a seat at that auction. No seat, no funding. And if there's no guarantee of funding then the chances of a further extension are slim to zero. But who knows, this whole thing has been filled with decisions that at first glance seem very odd. You also have to wonder about Mobilicity's commitment to its own subscribers when they still are showing 5 year old phones on their website and they can't be bothered to update it. The plans there are old too. What confidence should anyone have in Mobilicity when they can't be bothered to even think about basic house keeping?

  8. #8
    Join Date
    Apr 2008
    Location
    Canada
    Posts
    7,293
    Carrier(s)
    Koodo (03/2015-present)
    Feedback Score
    0
    Quote Originally Posted by underrated View Post
    I think the principals in Mobi just don't like WIND Mobile.
    I'm sure that's part of it. I think what it comes down to is, WIND's offer is reflective of what Mobilicity is actually worth in an environment where undue spectrum concentration is verboten. The guys at Mobi have totally inflated delusions of the company's value because they spent so much on acquiring that equity in the first place, and desperately believe that somehow some buyer (Videotron?) will pay more.

  9. #9
    Join Date
    Aug 2011
    Posts
    2,188
    Feedback Score
    0
    Isn't the set aside large enough that both Mobilicity and Wind can get half each and still have a usable slice of spectrum? It really seems absurd that a company under bankruptcy protection is looking at making expansionary moves. TBH, I hope Wind gets 100% of the set aside spectrum. Hopefully this will accelerate their acquisition of the remaining Mobilicity spectrum.

    Sent from my Nexus 7 using HowardForums

  10. #10
    Join Date
    Jun 2006
    Location
    GTA
    Posts
    6,398
    Device(s)
    Blackberry Z30, Blackberry Q10, Galaxy Nexus
    Carrier(s)
    Fido
    Feedback Score
    1 (100%)
    Quote Originally Posted by MCCANS View Post
    How much money are their creditors losing? LOL

    Sent from my Z30 using HowardForums
    Nothing really
    They invested in the brand hoping to sell for a profit
    Until a sale actually takes place they have not lost anything
    It is sad I need to state the obvious but some people just don't get it. Any posts I make are my own OPINIONS and in no way represent the views of my employer

  11. #11
    Join Date
    Feb 2013
    Posts
    764
    Device(s)
    Nexus 6
    Carrier(s)
    WIND Mobile
    Feedback Score
    0
    Quote Originally Posted by will888 View Post
    Isn't the set aside large enough that both Mobilicity and Wind can get half each and still have a usable slice of spectrum?
    I don't really understand all the ins and outs, but I believe you are correct.
    However, it seems I have heard that in the absence of Mobi there would be less of a "bidding war", and WIND would probably be able to pick up a goodly chunk for just the opening bid.
    Correct me if I'm wrong . . .

  12. #12
    Join Date
    Jun 2007
    Posts
    528
    Carrier(s)
    T-Mobile
    Feedback Score
    0
    Quote Originally Posted by underrated View Post
    I don't really understand all the ins and outs, but I believe you are correct.
    However, it seems I have heard that in the absence of Mobi there would be less of a "bidding war", and WIND would probably be able to pick up a goodly chunk for just the opening bid.
    Correct me if I'm wrong . . .
    http://www.ic.gc.ca/eic/site/smt-gst...0851.html#s6.1

    The US Band plan is based on 3 x 10 Mhz Blocks (5x5) [G,H,I] and 1 x 20Mhz Block (10x10) [J]

    The Canadian Band Plan is consolated into 1 x 30 Mhz (15x15) [G+H+I] and 1 20Mhz Block (10x10) [J]

    So in summary...
    If you are a new entrant, you get to fight over a single 30 Mhz Block of Spectrum!
    If you are an incumbant, you get to fight over a single 10 Mhz Block of Spectrum

    And yes, whichever new entrant wins that block gets a massive dose of spectrum!
    For example, If Wind gets southern Ontario - They now own a total of 50Mhz of spectrum!

    Suddenly, we got a nice LTE Network (15 x 15) [Theoretical Speeds of 110mbps DL] - Which is what T-Mobile calls "Wideband LTE"
    And then if a new entrant takes some spectrum from the BRS 2600, a real competitor is born.

    2015 Will be exciting for sure!
    T-Mobile
    $30 Simple Choice North America 10 GB

    T-Mobile
    $3 Pay by the Day

  13. #13
    Join Date
    Sep 2009
    Posts
    1,487
    Feedback Score
    0
    Quote Originally Posted by MCCANS View Post
    "William Aziz, the company's chief restructuring officer, said in an affidavit he is optimistic that by May 8, after the two spectrum auctions have concluded, "the wireless spectrum landscape will have materially changed and [Mobilicity's] transaction options may be materially different than they are today."

    Anyone understand what he is referring to here? How can the landscape "change".
    New spectrum available for use - therefore, the spectrum landscape is different = "changed". Perhaps overly dramatic, but ANY change in the wireless business can be pro or con for the possible sale of Mobi to whomever is most successful or unsuccessful in the auction in terms of an alternate source of existing spectrum (the only real asset Mobi has).

  14. #14
    Join Date
    Sep 2009
    Posts
    1,487
    Feedback Score
    0
    Quote Originally Posted by Mann Incognito View Post
    I have no idea what's going to happen regarding the creditor protection, but you've got to think that the creditors' further funding is contingent on getting a seat at that auction. No seat, no funding. And if there's no guarantee of funding then the chances of a further extension are slim to zero. But who knows, this whole thing has been filled with decisions that at first glance seem very odd. You also have to wonder about Mobilicity's commitment to its own subscribers when they still are showing 5 year old phones on their website and they can't be bothered to update it. The plans there are old too. What confidence should anyone have in Mobilicity when they can't be bothered to even think about basic house keeping?
    A bit of a two-way street. Mobi is looking to existing creditors and/or new investors to fund its bid in the auction. They do find themselves in a tough spot - the only asset they have is spectrum, to be viable as an independent they need more spectrum, but they are in creditor-protection so they cannot acquire any new debt to buy such spectrum without existing creditor approval. Existing creditors haven't coughed up any $ for spectrum yet and surely don't want their debt to become subordinate to any new debt, which could be a condition on the new funds. As for extension until May - that is stretch as the court has been shortening the extension periods lately not lengthening them, so they will have to sell the May time frame as something magical (hence, the landscape change story).

  15. #15
    Join Date
    Aug 2011
    Posts
    2,188
    Feedback Score
    0
    So, if there is only one 30 Mhz block for new entrants to fight over, then I suppose there two permutations here; 1. Wind is successful and Mobilicity will likely be done and be bought by Wind or perhaps Videotron on the cheap, 2. Mobilicity is successful and Wind or perhaps Videotron will have to pay ransom rates for Mobilicity if either have real aspirations to grow.

Page 1 of 4 1 2 3 4 LastLast

Similar Threads

  1. Mobilicity - will be seeking bidders for sale
    By MCCANS in forum Mobilicity
    Replies: 73
    Last Post: 12-18-2013, 05:57 PM
  2. Replies: 1
    Last Post: 05-20-2012, 08:57 PM
  3. HillCast seeks testers for financial app!
    By HCTech in forum Nextel Lounge
    Replies: 4
    Last Post: 01-21-2003, 02:46 PM
  4. HillCast seeks testers for financial app!
    By HCTech in forum General Nextel Discussion
    Replies: 4
    Last Post: 01-21-2003, 02:46 PM

Tags for this Thread

Bookmarks