Canada's Telus Buys Smaller Wireless Rival Mobilicity for $380 Million

7:46 AM PST 05/16/2013 by Etan Vlessing

The deal comes as Canada's biggest media groups, including Rogers Communications and Bell Canada, grow as bundled telecom players.

TORONTO – Telus Corp. on Thursday unveiled a deal to acquire smaller wireless phone provider Mobilicity in the latest sign that Canadian media giants are fast-becoming telecom players.

Calgary-based Telus, which in the last year has dramatically grown its IP-based TV subscriber base with its Optik TV service, will acquire Mobilicity for $380 million.

Telus has been negotiating with loss-making Mobilicity since February 2013 on a possible takeover of its 250,000 wireless customers amassed after three years in the Canadian market.

"A concern for our customers and employees led us to approach Telus, which has a reputation for a strong customer focus, as evidenced by their industry leading client loyalty," said Stewart Lyons, Mobilicity president, in a statement Thursday.

Telus and rivals Rogers Communications and Bell Canada are the big three Canadian wireless phone players, with Mobilicity, Wind Mobile and Public Mobile having launched in recent years to make market inroads here.

Shaw Communications, the western Canadian cable giant, in 2011 decided against launching its own wireless service, and recently sold off valuable wireless spectrum to rival Rogers Communications.

Like Telus, Rogers Communications and Bell are bundling their wireless offerings with video-rich Internet and cable TV packages.

Bell has struggled to secure regulatory approval for a $3.3 billion takeover of indie broadcaster Astral Media to drive video content like The Movie Network pay TV service, including HBO and Showtime series fare, down its growing mobile and online platforms.

Bell already owns the top-rated CTV conventional TV network and a string of cable channels like The Sports Network.

And Rogers Communications, Canada’s largest wireless player with major media holdings of its own, is growing its Sportsnet cable sports channel and City conventional TV network.

The one strong emerging wireless player is Quebecor, which has become a major regional wireless player in Quebec via its cable and telecom division Videotron.

Quebecor also includes the TVA French language TV network in Quebec.

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