In a terse press release, Orascom Telecom, a subsidiary of Vimpelcom Ltd, today announced that it is dropping its plans to acquire WIND Mobile. The company attributed the decision to “a review process and discussions with the government of Canada” but provided no specific reasons.
The Globe and Mail last week reported that concerns about national security were delaying the necessary approvals for the deal to move forward. WIND Mobile’s infrastructure uses Huawei hardware. Rumours continue to dog the Chinese-owned company that its products could be used by agents of the Chinese government to spy on or sabotage communication networks.
Orascom Telecom Holding has decided to withdraw its application for Investment Canada Act approval of its acquisition of control of WIND Mobile Canada.
Orascom Telecom says this decision follows a review process and discussions with the government of Canada.
Orascom Telecom says it continues to be interested in consolidating its interest in WIND Mobile Canada and in working with the government of Canada to achieve this goal.
The Egypt-based carrier had announced its plans to acquire the Canadian carrier in January. By buying out WIND Mobile CEO Anthony Lacavera’s stake in the company, it would have secured an “indirect 99.3% interest in Globalive Wireless Management Corp.”
WIND Mobile founder and CEO Tony Lacavera pledged to “continue working with Vimpelcom toward achieving our mutual objectives.”
It was revealed earlier this week that Verizon was mulling acquiring WIND Mobile to expand operations to Canada. Verizon CFO, Fran Shammo, confirmed the company’s interest in an interview at The Wall Street Journal‘s CFO Network conference in Washington. “We’re looking at the opportunity. This is just us dipping our toe in the water,” said Shammo.
It’s unlikely that the two are related but suggests that global carriers are definitely interested in expanding into Canada.
Sources : Orascom // The Globe and Mail // The Wall Street Journal