News coming out of Canada suggests that Verizon, the largest US carrier, is in “exploratory talks” to acquire WIND mobile in Canada. WIND, the carrier sitting comfortably behind the likes of Bell, Rogers and Telus, is no stranger to acquisitions. Telus tried in vain to acquire WIND not long ago, so the low-hanging fruit is there to be had for Verizon.
The issues with such a deal are not easily overcome for Verizon. There are certain criteria to be met when owning a foreign company, and their partnership with Vodafone limits their ability to deal independently. While obtaining WIND may be a good idea on paper, the reality is much more difficult than simply cutting a check.
The upside, and perhaps real interest from Verizon, has to do with spectrum. There is an auction coming up for 700mHz spectrum in Canada, and we’re all well aware of Verizon’s desire for more bandwidth. The auction has been pushed back to January 2014, which gives Verizon a bit of time to explore the deal a bit more. If WIND did end up under the Verizon brand, it gives them a much stronger position to bid in the auction.
So why WIND? The Canadian government recently altered their rules concerning foreign ownership of domestic carriers. As it now reads, a foreign company like Verizon could own a carrier with less than 10% market share. With 600,000 subscribers, WIND definitely fits that description.
It’s a long shot, but still an interesting avenue for Verizon to be pursuing.