TORONTO – Wind Mobile’s “best quarter ever” was overshadowed by speculation that the wireless carrier could be sold or merged with another Canadian company.
Jo Lunder, CEO of Wind’s Amsterdam-based financial backer VimpelCom, sparked the rumours Wednesday morning while on a call discussing the global telco’s first quarter financial results. When asked about its Canadian operations, Lunder alluded to discussions with different players in this market to either sell Wind or combine it and take “a smaller position in a larger entity”. He added his plans would have been different had VimpelCom been able to take control of Wind Mobile. (As Cartt.ca reported, Industry Canada last year nixed a deal that would see Wind become fully foreign-owned by Egyptian-based telcom giant Orascom Telecom Holding, now a VimpelCom subsiduary.)
Dvai Ghose, managing director/head of research for Canaccord Genuity said that his assumption is that Lunder’s reference to potentially taking “a smaller position in a larger entity” may refer to Videotron and parent Quebecor Media (QMI).
“This is because Videotron purchased the Upper C1 700 MHz block in most of Ontario, British Columbia and Alberta, as well as in Quebec in the 700 MHz auction and has 10 MHz of AWS spectrum in Toronto”, Ghose wrote in a note to clients. “With the national incumbents being prevented from buying new entrants by regulators, even though the 5 year set aside for new entrant AWS licenses have expired, Videotron/QMI is the only obvious acquirer of Wind and Mobilicity. QMI may well be in discussions with VimpelCom to purchase Wind with QMI and/or Videotron equity.”
Wind Mobile announced Wednesday that it recorded 25,916 new net subscribers in the first quarter of 2014, bringing its total to 702,125 active subscribers in Canada. It also increased ARPU by 12% year-over-year, from $27.60 in Q1 2013 to $31.00; grew its distribution footprint and branded points of sale to 310 retail properties; and through “numerous network upgrades”, now has 1,385 sites on air.
“It’s been a tremendous start to the year for Wind Mobile and we’re very pleased to report that we’ve experienced our best quarter ever”, reads an emailed statement to Cartt.ca from a Wind Mobile spokesperson. “Not only have we surpassed the 700,000 active customer mark, with a 17 per cent growth in subscribers, but our ARPU has grown 12 per cent to $31.00.
“We have no doubt that 2014 will be a great year for Wind. We have started this year strong thanks to industry firsts including being the first Canadian telecommunications company to offer U.S. unlimited roaming and we will continue to provide Canadians with the value, simplicity and true mobile freedom they have come to expect from Wind Mobile, while we continue our growth as Canada’s fourth national carrier.”
