Telus (TSX:T) has entered into an agreement to purchase Ontario-based wireless carrier Mobilicity for $380 million, both companies announced this morning.
Mobilicity’s chief restructuring officer William Aziz said that Mobilicity has been losing a significant amount of money every month, and that the acquisition represents the best possible alternative for the company.
“The financial strength of Telus will allow the business to be continued in a way that will benefit customers and employees,” said Aziz.
Mobilicity had announced April 26 that it had started a restructuring process and that a new plan would provide a structure for an “as yet to be determined” purchaser to acquire all of its outstanding shares, with the purchase price being used to repay all outstanding first and second lien debt.
Stewart Lyons, the president of Mobilicity, said the company approached Telus out of concern for its customers and employees.
Telus will take over all of Mobilicity’s 250,000 customers and will retain all of its 150 employees.
The agreement is subject to approval by the Competition Bureau, Industry Canada and Mobilicity’s debtholders, among other conditions.
