The Canada Pension Plan Investment Board (CPPIB), MTS Allstream and The Blackstone Group have formed a consortium to make a deposit and submit an application to bid as a new entrant in the upcoming advanced wireless services spectrum auction.
The consortium made a $340 million deposit in the form of letters of credit to Industry Canada.
The auction, which is scheduled to begin on May 27, 2008, is being conducted by Industry Canada. One of the objectives of the auction is to foster greater competition and innovation in the Canadian wireless market.
The CPPIB, MTS Allstream, and Blackstone will each own approximately one-third of the new entity, which will compete with BCE, Telus, and Rogers, the parent company of Benefits Canada.
Ownership and governance of the new entity will comply with Canadian ownership and control rules for the telecommunications sector.
““We are moving towards the auction with exceptionally strong partners, a clear and disciplined strategy, and a focus on creating long term value for our shareholders,” says MTS Allstream’s CEO, Pierre Blouin. “A strong new entrant has the potential to bring much-needed innovation to Canada’s wireless telecom sector.”
Last year, the CPPIB was part of a consortium that tried to take BCE private, but was outbid by a group led by the Ontario Teachers’ Pension Plan.
For more about the battle to buy BCE, click here to read our special section, The Rise of Private Equity.
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