Wind Mobile Subscribers Surpass 700,000, but Parent Company Still Wants to Sell

by Istvan Fekete on May 15, 2014

Wind Mobile recorded an incredible first quarter this year, but its parent company still wants to sell the Canadian wireless division. The news comes directly from Amsterdam-based VimpelCom, which released its quarterly earnings yesterday and said Wind Mobile added roughly 26,000 new subscribers in the period, and surpassed the 700,000 subscribers base mark. Its ARPU (average revenue per user) was up 12% year-over-year to $31.

But this doesn’t make the Russian company owners happy, the press release suggests: after writing off the value of Wind Mobile entirely a couple of months ago, the owners are still eyeing an exit from the Canadian wireless market.

According to Bloomberg, VimpelCom chief executive Jo Lunder said the company may sell its Canadian business or “swap it for [a] stake in [a] larger operator working in the country.” You may recall that Wind Mobile pulled out of the 700 MHz spectrum auction at the last minute, as its backer said it wouldn’t finance such a purchase.

“What’s going on in Canada, I think, is very simple. We decided not to participate in the 700 auction early in the year because there was no clear path to control. At the same time, we have written off $1.5-billion of investments in Canada over the last couple of years,” he said. “And for that reason… we have no intention really to put any more funding into Canada at this point.”

“For that reason, we are now having different discussions with different players in that market to either sell it or to combine it with others and take a smaller position in a larger entity,” Mr. Lunder said.

It is worth noting here that VimpelCom was unsuccessful in taking full control of the Canadian wireless division when it purchased founder Anthony Lacavera’s remaining interest in the Canadian business through a VimpelCom subsidiary and original Wind backer Orascom Telecom Holding back in January last year.

The reason: the government decided not to allow the takeover, so in the end Anthony Lacavera still controls two-thirds of voting shares and has about 35% economic interest in the wireless player.

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Written by: Istvan Fekete. Follow by: RSS, Twitter, Facebook, or YouTube.

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