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Summary:

Microcell, a Canadian company in partnership with others with really deep pockets is building a Canada-wide broadband wireless network. The company has enough spectrum and has recently attracted the affection of wireless super hero, Craig McCaw who has pumped in about $150 million into the company. […]

Microcell, a Canadian company in partnership with others with really deep pockets is building a Canada-wide broadband wireless network. The company has enough spectrum and has recently attracted the affection of wireless super hero, Craig McCaw who has pumped in about $150 million into the company.

bq. Microcell announced it was teaming up with Allstream Inc., formerly AT&T Canada, and a U.S.-based investment firm headed by Canadian wireless guru Nick Kauser, a former Rogers Cantel executive. The purpose of this coming-together was to unlock the potential of Inukshuk’s wireless spectrum, and each partner offered to contribute in a way that played up its own strengths.

bq. Microcell, meanwhile, has attracted a sugardaddy of its own. Four weeks ago, the company announced it was proceeding with a $150-million financing deal, with a third of the funds coming from wireless pioneer and multi-billionaire Craig McCaw. McCaw’s investment company Eagle River Investments LLC, based in Washington, D.C., has since become the financial driver behind a number of major telecommunications ventures in the United States — some successful, such as Nextel, and others a flop, such as satellite venture Teledesic.

The payoff I guess will be twinfold for Craig McCaw – Microcell’s project is a success he makes money; and while that is happening, one of his other investments, Next Net, will make a ton of money selling equipment to this new Canadian network. See how billions become mega billions!

bq. The payoff I guess will be twinfold for Craig McCaw – Microcell’s project is a success he makes money; and while that is happening, one of his other investments, Next Net, will make a ton of money selling equipment to this new Canadian network. See how billions become mega billions!

Source: The Toronto Star

  1. Well, McCaw has deep pockets aynway. Allstream came out of bankruptcy in 2003 and has been bought up by MTS, who seem more interested in focusing Allstream’s efforts on traditional revenue streams. Microcell (also the company behind Fido cellular) has been on death watch for a couple years now.

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  2. McCaw has agreed to fully backstop a C$100M rights issue for Microcell. In the event the rights issue is fully subscribed by existing shareholders (likely given the stock price is $3 above the strike) he will invest an incremental C$50M. This will be the minimum he invests. So he’s putting in somewhere between C$50 and C$100 of his own cash depending on the uptake from current shareholders.

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