Bell Canada announced Tuesday its intention to sell its subsidiary Northwestel to Sixty North Unity, a consortium of indigenous organizations from the Yukon, Northwest Territories and Nunavut, in a transaction worth up to $1 billion in cash.
The deal will see Northwestel become fully indigenous-owned, making it the largest telecommunications company worldwide with full indigenous ownership, a Bell press release says.
The strategic transaction will create more opportunities for investment and ownership in critical infrastructure and communications projects for northern indigenous communities, the release says. In addition, the acquisition “will provide Indigenous communities with greater access to long-term stable cash flows to reinvest in the critical areas of community infrastructure, housing, social services, health, and education programs for those that live and work in the North,” the release adds.
Sixty North Unity says it plans “significant capital investment to drive digital growth and enhance connectivity across the North to benefit communities and businesses,” according to the release.
Some of the consortium’s plans include: doubling internet speeds to 1 Gbps for fibre customers; expanding high-speed internet availability to meet the CRTC’s universal service objective of 50/10 Mbps to more than 97 per cent of homes in the Yukon and the Northwest Territories; offering low Earth orbit satellite technology to deliver 50/10 Mbps speeds to eight satellite-served communities in the Northwest Territories and 25 satellite-served communities in Nunavut; and investing $4 million to build the Great Slave Lake Fibre Project, bringing critical resiliency to the Yellowknife capital and South Slave regions of the Northwest Territories.
“As Indigenous people, we have long believed we are best placed to make the necessary decisions affecting services in our communities,” Sixty North Unity’s Tiffany Eckert-Maret said in the release. “The acquisition of Northwestel will give us the autonomy to make those investments and choices to serve our telecommunications needs into the future.”
Eckert-Maret is one of three leaders of the consortium and chief operating officer of Da Daghay Development Corporation in the Yukon. The consortium’s other leaders are Darrell Beaulieu, president and CEO of Denendeh Investments Inc. in Northwest Territories, and David Omilgoitok, president and CEO of Kitikmeot Corporation in Nunavut.
“Indigenous partnerships with industry have continued to evolve and expand,” Beaulieu said. “This collaboration across all three territories will allow us to own and operate a leader in northern telecommunications services and is the next logical step in the development and growth of our businesses. Bell has provided us the support necessary to realize this important opportunity.”
“This acquisition allows us to take the lead in continuing to address the critical gap in telecommunications services in our northern communities,” Omilgoitok said. “Expanded investments in fibre and Low Earth Orbit (LEO) infrastructure have the ability to transform the North and put us on equal footing with the rest of Canada.”
Sixty North Unity says it intends to maintain Northwestel’s management team under the leadership of current president Curtis Shaw as well as its dedicated employee base. It also intends to increase indigenous representation in the workforce, in part through expanded training and mentorship programs.
“The Northwestel team is filled with honour and gratitude to serve the North in this more profound way,” Shaw said in a statement. “This monumental step towards economic reconciliation will see direct benefits stay in northern Indigenous communities. I can’t wait to see what advancements this new partnership will bring to northern Canadians. We’re grateful for the leadership and support we’ve received from Bell Canada over the past 36 years and are excited to embark on this new chapter with Sixty North Unity.”
Northwestel’s corporate headquarters are to remain in Whitehorse, with its operational headquarters remaining in Yellowknife and the regional office in Iqaluit.
Following the close of the transaction, Bell will maintain “a strong and strategic partnership” with Northwestel through ongoing operational support, and as Northwestel’s largest customer, according to the press release.
Closing of the transaction — valued at up to $1 billion in cash, subject to adjustments — is still subject to certain closing conditions, including the completion of confirmatory due diligence, securing financing and receipt of regulatory approvals, the release says.
Bell says it intends to use the proceeds from the transaction to pay down debt.
“This historic transaction embodies Bell’s ongoing commitment to walking the path of reconciliation to build a more inclusive, connected Canada,” Mirko Bibic, president and CEO of BCE and Bell Canada, said in the release. “I congratulate Sixty North Unity and Northwestel on this visionary partnership to advance economic reconciliation through Indigenous ownership of critical telecommunications infrastructure in their communities. For Bell, it has been an honour to play a role in connecting and investing in communities across the North for the past 36 years, and we look forward to a strong and long-lasting continued partnership with Northwestel.”
