Canadian startup urges consolidation in the market

07 June 2013 | Kavit Majithia


Public Mobile, a Canadian telecoms start-up, has hit out at the industry and urged for increased consolidation in the market.

Venture capital firm Thomvest and private equity company Cartesian Capital bought out the operator this week, fitting in with the government’s aims to reduce the power of larger players in the country.

The company said consolidation was needed in an industry dominated by industry behemoths, and Public Mobile chief executive Alex Krstajic said the need to consolidate struggling startups including Wind and Mobilicity was pressing.

Krstajic did however tell Reuters that he did not see Public Mobile as serving as the acquirer in any process, or take a lead role in any potential merger or consolidation. “We see ourselves having a place in consolidation, it’s not clear who the consolidator is yet,” he said. “The consolidator will be one who brings the money.”

All three companies acquired wireless spectrum during a Canadian auction in 2008, but have struggled to find profitable ways to utilise the capability.

The Canadian government has pledged to increase competition in the sector, and targeted various financial institutions to back new entrants, as a way to reduce power in the sector from industry giants Rogers Communications and TELUS.

The acquisition of Public Mobile has since renewed the government’s aims to increase private sector investment in the telecoms industry,