When BCE Inc. announced November 28 that it plans to buy Burnaby’s Glentel Inc. for $670 million, including debt, it sent Glentel’s share price soaring 102% and validated the company’s business model of operating small stores in malls that sell wireless plans and accessories.
Though Glentel (TSX:GLN) is far from a household name, it has quietly increased revenue to $1.37 billion in 2013, making it B.C.’s 14th largest public company – only one spot behind B.C.’s largest retailer, Lululemon Athletica Inc. (Nasdaq:LULU).
Glentel has 494 stores across Canada, 735 stores in the U.S. and 147 other points of sale in Australia and the Philippines, which will bolster Bell’s (TSX:BCE) retail presence in Canada while expanding its U.S. retail operations.
“The key to our success is that we’re in malls,” Glentel CFO Jas Boparai told Business in Vancouver. “That’s a predictable environment. You have people who go there for a T-shirt and they walk by and come in and look at the latest products.”
After rapid expansion of Glentel brands such as WirelessWave and Tbooth Wireless in anglophone provinces and La Cabine T sans fil in Quebec, it was only a matter of time before there would be competition.
Best Buy Canada, which is also based in Burnaby, launched Best Buy Mobile, a chain of similar stores, in 2010. The director of that unit, Eric Park, told BIV in 2012 that Best Buy Mobile had expanded to 33 locations and that another 15 were set to open within 18 months. According to the company, there are now 50 standalone Best Buy Mobile stores and six Best Buy Mobile kiosks.
Glentel’s path was to expand rapidly from a single store in Metropolis at Metrotown in 1997 to 86 stores by 2005, when the company bought Montreal’s Cabtel Corp. for an undisclosed amount from its Hartco Corp. parent.
That acquisition gave Glentel 49 stores that then operated as The Telephone Booth in Ontario and Alberta and La Cabine Telephonique in Quebec.
“We kept looking for growth, and in 2010, we saw Diamond Wireless, which mirrored Glentel in our values and the way we do business,” Boparai said.
Those values included training employees well and providing strong customer service.
Glentel bought an 81.5% stake in the 128-store, Salt Lake City-based company for $50.45 million.
“We left the founders with 18.5% of the company, and they still run the business for us,” said Boparai. “We also bought Wireless Zone, which is a Verizon dealer out of the East Coast. Diamond Wireless was mostly West Coast based.”
Glentel has the rights to operate wireless kiosks in Costco Wholesale (Nasdaq:COST) and Target Corp. (NYSE:TGT) locations in Canada as well as BJ’s Wholesale Club kiosks in the U.S. •
