Mobilicity Looking for AWS-3 Spectrum Funding and Asks the Judge for Yet Another Creditor Extension

Mobilicity is in the news...again, as they try to secure financing to participant in the AWS-3 (Advanced Wireless Services) spectrum auction that is taking place on March 3, but must submit their application to participate by January 30.  The auction is slanted by the government to favor new entrants, such as Mobilicity and WIND Mobile - 60-percent of the AWS-3 spectrum is being set aside for just that purpose.  Both carriers operate in the Ontario, British Columbia and Alberta area and it is estimated that Mobilicity needs to come up with about $62 million for a refundable deposit by January 30.  Unsurprisingly, they are having a difficult time securing the money.

Mobilicity has gone back to the judge to ask for another extension to keep its creditors at bay - the current extension expires January 30 - that was the 7th or 8th one...I have lost track.  They are asking for protection from legal proceedings for it and its 158,637 customers as of December 31, which is a slight increase from its previous court filings...until May 8.  TELUS wanted to purchase Mobilicity, however, the government blocked the sale two or three times because they will not approve a sale to the Big Three and allow them to grow bigger by buying out the competition.

Mobilicity has said that they are having continued discussions with various parties about purchasing or merging with them, but have been unable to sign any agreements.  William Aziz, the company's chief restructuring officer, believes after May 8, when 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."  In other words, after the dust settles, there may be a more likely candidate in which they can strike up a deal.  The company purchased AWS-1 bands in 2008 for $243 million and that is about all that remains of Mobilicity's assets.  Through the periods of being under the court's protection, they are operating under a "cash flow break-even basis" - bringing in enough money to pay their bills and that is about it, although their subscribers have remained relatively stable.

WIND Mobile with its 800,000+ subscribers onboard is also set to bid in the upcoming auction.  If Mobilicity is unable to come up with its $62 million and is unable to participate in the auction, WIND Mobile could acquire the licenses in Ontario, British Columbia and Alberta for a mere $62.5 million.  The landscape of the wireless world of Canada could indeed change, although maybe there could be a WIND Mobile-Mobilicity merger.

Copyright ©2019 Android Headlines. All Rights Reserved
This post may contain affiliate links. See our privacy policy for more information.
You May Like These
More Like This:
About the Author

Cory McNutt

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]