Birch Hill Withdraws from Canada’s 700 MHz Spectrum Auction

by Istvan Fekete on October 17, 2013

A week after the application submission deadline for participating in the forthcoming wireless auction, the government made pubic a list containing 15 companies interested in acquiring spectrum. Now there are only 14 left, as Birch Hill Equity Partners has withdrawn its application, reports Reuters.

Rumour has it that private equity firm Birch Hill was interested in striking a deal with small wireless players such as Wind Mobile and Mobilicity. The sources, who wished to remain anonymous, have whispered that Birch Hill was ready to be the puppy of Canada’s No. 1 carrier, Rogers, and bid for these two using the red carrier’s money. This sounded like a “reasonable” way to bypass Ottawa’s wireless policy, which forbids mergers between incumbents and wireless startups, as well as wireless license transfers.

And the incumbents are ready to do anything to own 100% of the market, which even includes giving a helpful hand to the struggling wireless startups, just as Telus did to Mobilicity. But, as it turns out, no matter if you have paid $240+ million on acquiring the spectrum, the government still controls your license. But that’s not a problem; this is how things are in Canada.

Anyways, back to Birch Hill: the private equity firm suddenly signaled interest in the local wireless market back in August, when it joined the Registry of Lobbyists to lobby Ottawa over investment in wireless carriers. Back then, it gave the impression that it wanted to buy Wind Mobile and Mobilicity, but it was silent about the backing coming from Rogers.

The deal was presumably part of the high-profile campaign launched by the incumbents against Ottawa’s wireless policy and Verizon. Since then, the US wireless giant has signaled that Canada’s mobile landscape isn’t as important as buying out Vodafone’s stake in the company.

As the “danger” factor didn’t exist, Birch Hill’s role has ended, I assume. It was a “contract” for a determined period.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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