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Struggling wireless carrier asks Ontario Superior Court of Justice to extend “stay” period shielding it from legal action after Telus bid fails. (Michelle Siu for The Globe and Mail)

Struggling wireless carrier asks Ontario Superior Court of Justice to extend “stay” period shielding it from legal action after Telus bid fails.

(Michelle Siu for The Globe and Mail)

Mobilicity asks to extend creditor protection Add to ...

With a takeover by Telus Corp. off the table yet again, struggling wireless carrier Mobilicity is asking the court for more time to evaluate its options.

Mobilicity, which has been under creditor protection since September, filed materials this week asking the Ontario Superior Court of Justice for a further extension of the “stay” period shielding it from legal action to Sept. 26 from June 30.

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The new entrant mobile provider first struck a deal to sell to Telus in May, 2013, for $380-million, but the federal government blocked the transfer of Mobilicity’s spectrum to one of Canada’s biggest wireless players last June.

Mobilicity has since struggled to find a buyer for its most valuable asset, licences for the radio waves used to build cellular networks that it purchased for $243.1-million in a 2008 auction. Repeated attempts to work out new transactions with Telus have failed as Ottawa has dug into a policy designed to keep spectrum originally earmarked for new entrants out of the hands of incumbent operators.

In April, the court ordered Industry Canada to attend a mediation after Telus made a renewed $350-million offer to purchase Mobilicity after a moratorium banning the sale of its licences to an incumbent expired.

However, as The Globe and Mail first reported in May, Telus walked away from its offer under pressure from the federal government. Ted Woodhead, senior vice-president of regulatory affairs for Telus, confirmed last week that the company withdrew the bid.

In an affidavit sworn Monday, Bill Aziz, Mobilicity’s chief restructuring officer, said the Telus bid was terminated, adding, “In light of the ongoing mediation, [Mobilicity] is not in a position to comment further at this point on available next steps regarding any transactions or other restructuring alternatives.”

Quebecor Inc. said last week it is willing to expand its wireless business, operated by its Vidéotron Télécom Ltée division, outside Quebec if it gets assurances from Ottawa of “fair” rates for roaming on larger players’ networks. The company’s CEO Pierre Dion said it is also considering a deal with one of the new entrants, though he did not specifically name Mobilicity or its larger competitor Wind Mobile.

“We’re in discussions with various groups at the moment,” he said at a press conference Thursday. “We need partners for more spectrum.”

A representative for Mobilicity, which is legally known as Data & Audio-Visual Enterprises Holdings Inc., declined to comment further Tuesday. The court is set to hear the company’s request for an extension of the stay on Wednesday.

Mobilicity said it expects to have 155,000 active subscribers and 41 full-time employees by the end of June. At the time of Telus’s first bid just over a year ago, it had about 250,000 total customers or 220,000 active subscribers and 150 employees.

Mr. Aziz said in the filing that revenue and cash flow have been higher than expected and that the company expects to be able to continue operations until Sept. 26, noting that “new customer acquisition remains stable, and monthly average revenue per customer continues to grow modestly.”

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