Industry Canada has approved a plan by Telus (TSX:T) to buy Ontario upstart mobile carrier Public Mobile.
Telus said in a release it would own 100% of the company, provided the Competition Bureau approves the transaction.
Telus is not releasing how much it plans to pay for the company, which was founded in 2010 and has 280,000 customers in the Toronto, Niagara, Hamilton and Montreal regions.
Industry Canada's approval of the sale may seem surprising, given the fact it has blocked earlier attempts by Telus to acquire another carrier – Mobilicity.
But Mobilicity is one of the companies bidding on the coveted 700 megahertz spectrum in an upcoming auction. There are restrictions in place against the acquisitions of companies like Mobilicity. The federal government has stated it does not want to see the 700 MHz spectrum concentrated among Canada's major telecoms, which own 85% of the spectrum in Canada.
Public Mobile is not bidding on the 700 MHz spectrum. Industry Minister James Moore has approved the transfer of Public Mobile's G-block frequency to facilitate the sale.
"We look forward to the successful completion of this transaction, and migrating Public Mobile's customers onto Telus' world-class 4G LTE network while putting their spectrum to good use for millions of customers across Canada," said Eros Spadotto, Telus' executive vice-president of technology strategy and operations.
"Public Mobile's PCS G block spectrum is part of a developing ecosystem that is being driven by the insatiable demand consumers have for access to wireless data applications."
Public Mobile CEO Alek Krstajic said, "Following our review of strategic options for our organization, Telus stood out as the company most committed to strong customer service and innovation.
"We are confident this is the right decision for our customers, our company, our employees and our investors."
