Wind Mobile Boosts Spectrum Holdings by 180%, but Financing Remains an Open Question

by Istvan Fekete on March 9, 2015

Ottawa raised $2.11 through the AWS-3 spectrum auction. The results were officially announced on Friday, and the clear winner was Wind Mobile, which grew its spectrum portfolio by 180% and secured licences in all three provinces in which it operates – B.C., Alberta, and Ontario – at a bargain price. While this is awesome news for the small carrier, it also raises a series of questions, and one of them concerns financing.

Wind Mobile was lucky enough to win licences at a bargain price, since its “rival”, the bleeding Mobilicity, lost its backing at the last minute. You may recall that Mobilicity secured financing of roughly $65 million to participate in the auction, but its backers didn’t account for the competition when they bet on the carrier. In the end they walked away, forcing Mobilicity to drop out of the auction through lack of financing.

As a result, Wind Mobile was able to secure all the set-aside AWS-spectrum licences for $56 million, payable by April 20, 2015, since it was the lone bidder in each region.

The spectrum gives the carrier the foundation it needs to expand its operations nationally. When the results were announced, Wind Mobile founder and chairman Anthony Lacavera tweeted that the next step was to roll out LTE to keep their 800,000 customers satisfied.

“It’s been a long, winding seven-year road to finally get Wind on a very solid path to a fourth carrier position in the market,” Anthony Lacavera, Wind’s founder and chairman, said in a telephone interview after the provisional winners were revealed. “We’ve now acquired enough spectrum to position the company with LTE services, so over the next 12-24 months we’ll be rolling out LTE across our network.”

However, the investment phase doesn’t stop there: Paying the $56 million bill is just the start. The company will need to invest a minimum of $300 million to develop the new LTE network over the next 24 months according to the company’s plans.

Next, there is the 2500 MHz spectrum auction scheduled for later this year, and we know that Wind will be one of the bidders. That will allow the carrier to secure airwave licences to deploy nationwide coverage. In other words, the past seven years were rough, but the most challenging period is ahead.

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

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