Egypt's Orascom plans formal control of Wind Mobile

Egyptian telecommunications company Orascom Telecom Holding SAE (ORTE.CI, ORSTF) plans to take formal control of Canadian carrier Wind Mobile (WMO.WA) in the wake of key changes to this country's foreign investment rules.

The Cairo-based telco announced Sunday it will ask shareholders to approve a proposal that would see subsidiary Orascom Telecom Holding Canada Ltd. convert its sizable block of non-voting shares in Wind's parent company, Globalive Investment Holding Corp., into voting shares to give it majority control.

In addition to a takeover of Wind, that share-conversion plan would also pave the way for Orascom to restructure a loan to Globalive and forgive roughly C$450-million of interest. By cleaning up Wind's balance sheet and simplifying its ownership structure, Orascom is likely preparing the Toronto-based carrier for an eventual merger with smaller rival Mobilicity.
"Orascom exercised a right they have always had to increase their voting shares," said Wind CEO Anthony Lacavera. "I see this as a big positive for Wind in that this will give them the confidence to continue investing in Canada and it positions us to lead the necessary new entrant consolidation."