Earnings
Bell Canada Acquires Virgin Mobile Canada As Pricing Pressures Mount
Bell Canada has acquired Virgin Mobile (NYSE: VM) Canada in the hopes of driving wireless-customer growth and competing more effectively with other discount providers. Bell Canada, which already owned half of Virgin Mobile Canada, paid $142 million for the remaining stake, reports the Financial Post.
In a conference call discussing first-quarter financial results, Bell Canada’s CEO George Cope said it sees an opportunity to start selling the service in The Source, a chain of electronics stores that Bell Canada bought in March. The Virgin brand will start being sold in stores starting in January, after a contract with Rogers Communications expires.
The Financial Post wrote that in Canada, competition has been growing among pre-paid providers as both Rogers and Telus have started offering cheaper plans through their respective discount brands, Fido and Koodo. Now Bell Canada will have two discount providers—Virgin and Solo. Cope said they may consider eliminating one of the two brands later. During the quarter, Bell added 30,000 new subscribers, which is 5,000 less than a year ago. Additions were largely affected by fewer new prepaid customers.
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