Bell divests 50% share of Glentel to Rogers
BCE and Rogers Communications – parent companies of Bell Canada and Rogers – have reached a deal over the control of Canadian mobile phone retailer Glentel.
Bell will divest 50% of its ownership stake in Glentel to rival Rogers Communications. In exchange, Rogers will pay 50% of the Glentel transaction value in cash to Bell, following the successful closing of the acquisition. As part of the agreement, Rogers will also withdraw its application for an injunction to block Bell’s acquisition of Glentel.
"Providing continued access to Glentel's first-class wireless retail operations for both competitors, this agreement greatly reduces Bell's cost to acquire Glentel and helps ensure the transaction closes as scheduled to the benefit of Glentel shareholders," said George Cope, president and CEO of BCE and Bell Canada. "Glentel's distribution scope and renowned service and sales capabilities remain key to Bell's strategy to accelerate wireless in Canada while delivering an improved customer experience."
In November, Bell acquired all of Glentel’s approximately 22.4 million shares for approximately $594 million. The total enterprise value of Glentel is estimated at approximately $670 million including net debt and minority interest of approximately $78 million.
A meeting for Glentel shareholders is scheduled for Jan 12 2015 and the transaction is expected to be completed by the end of the first quarter of 2015.