TORONTO-Rumors continue to swirl in the wireless sector here that Microcell Telecommunications of Montreal is for sale. Microcell operates the Fido brand GSM personal communications services (PCS) network and started its Canadian operations in 1997.
Microcell declined to comment on any speculation. The carrier continues its buildout and is bidding on new spectrum being auctioned this year in Ottawa for third-generation (3G) services.
“Microcell has been up for sale for a long time, and they’re overvalued because they’re an acquisition target. They’re facing a very difficult proposition of having to build a comparable network to ours,” said Charles Hoffman, chief executive officer of rival Rogers Wireless.
Rogers announced in December it is also adopting GSM technology, making it the second Canadian GSM carrier.
Analyst Eamon Hoey, of Toronto-based Hoey Associates Telecommunications Consulting Services, indicated Microcell faces heavy capital demands in rolling out new-generation voice and data services. “It’s clear Microcell will have to improve its national coverage or face the likelihood of being bought by another company,” he said.
Microcell minority owner Voices tream Wireless is considered a likely buyer once foreign-ownership restrictions are eased or removed. Currently, VoiceStream has a 15-percent equity stake in Microcell.
