Mobilicity Enters in Debtor Agreement to Secure Funds for AWS-3 Spectrum Auction


With only 158,637 subscribers and considered a small carrier, Mobilicity has sure been in the news a lot, but not in a good way. Already under the court's watchful eye from creditor protection since September 2013, they continue to ask for another extension to go from January 30 to May 8. Meanwhile, to make matters worse, all parties that wish to participate in the (Advanced Wireless Services) AWS-3 Spectrum Auction this April must have their $62 million security deposit filed with the government by January 30 and then have their sealed bid in by May 3.

The government has set aside 60-percent of this Spectrum for the smaller carriers, such as WIND Mobile and Mobilicity. Both carriers operate in the Ontario, British Columbia and Alberta area and it is important for Mobilicity to compete in the auction or WIND Mobile could buy it all up for a song and forever change the wireless landscape of that area. There have been rumors for months that WIND would like to acquire Mobilicity. WIND then made a play to snatch Mobilicity subscribers by offering a $60 credit to come over to the WIND Mobile team, and then they upped the ante by announcing six months of free service on their $35 plan that included a free SIM card. Some say this is an attempt by WIND Mobile to bankrupt Mobilicity so they would be an easy buy-out.


The chief restructuring officer, William Aziz, said that Mobilicity has reached an agreement to enter into a second debtor-in-possession (DIP) for $65-million from some of the company's existing debt holders. They structured it off the original DIP financing arrangement for $30-million that Mobilicity entered into when it first filed for protection under the Companies' Creditors Arrangement Act.  Of course, all of this funding is contingent upon court approval, although there is no reason to believe that it will not be approved. Their plans are to create a new wholly own subsidiary called Mobilicity SpectrumCo, whose sole purpose would be to participate in the auction.

If Mobilicity does win the auction, we are not sure what they will win other than more debt than they already have. It will be interesting to see if the deal is approved, if they bid in the auction, if they win the auction and what Mobilicity's future will hold. Please hook up with us on our Google+ Page and let us know what you think about Mobilicity and their chances to stay in business… as always, we would love to hear from you.

Share this page

Copyright ©2015 Android Headlines. All Rights Reserved.

This post may contain affiliate links. See our privacy policy for more information.
Senior Writer

Cory has written for Androidheadlines since 2013 and is a Senior Writer for the site. Cory has a background in Accounting and Finance and worked for the FBI in the past. From there he pursued his Masters in English Literature. Cory loves Android and Google related technology and specializes in Smartphone Comparisons on our site. Contact him at [email protected]

View Comments