Rogers Communications Inc. would be interested in buying Globalive's wireless spectrum if the telecom startup is unable to launch its business following a regulatory ruling that found it was not Canadian controlled.
"Spectrum is a very valuable asset," Rogers chief executive officer Nadir Mohamed told reporters Friday. "Rogers for sure would be interested in picking it up."
Privately held Globalive Communications has been in limbo since late last month, when the Canadian Radio-television and Telecommunications Commission ruled the company is effectively under the control of its Egyptian-based financial backer, Orascom Telecom.
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The ruling means Globalive can't launch without major changes to its ownership structure.
The company had spent about $442.1-million on buying wireless spectrum across Canada during last year's government auction and planned to start offering mobile phone service late this year or in early 2010.
For Rogers, owner of the country's largest wireless service provider, the CRTC ruling means there will be less new competition entering the market. Canada's other two large established carriers, Telus Corp . and BCE Inc., also stand to benefit if Globalive doesn't launch.
In the ruling, the CRTC said Orascom owns 65.1 perc ent of Globalive's equity, has entered into a strategic technical arrangement with the firm, and controls and holds the Wind brand under which Globalive had been set to operate. It also holds the overwhelming majority of Globalive's outstanding debt.
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Anthony Lacavera, Globalive's chairman and founder, told Reuters the CRTC ruling has put the entire business at risk and has made attracting new outside investors nearly impossible. He added the company is still weighing its options.
Globalive is one of several wireless newcomers poised to challenge BCE, Telus and Rogers. The others include Quebecor's Videotron unit, as well as privately held DAVE Wireless and Public Mobile.