Craig Wireless acquires Teleglobe interest in Look Communications

Wireless cable and Internet company Craig Wireless International Inc. appears to have national ambitions as it significantly increased its ownership stake in Look Communications Inc. last month with the purchase of nearly 7.2 million Look shares (RoW, Jan. 20/03). Report on Wireless has learned that Craig bought those shares from Teleglobe Inc., a bankrupt international communications provider. Unique Broadband Systems Inc. and Telesystem Ltd., Charles Sirois’ private holding company, are Look’s two other major shareholders. Craig, which now owns almost 30% of Look, has also indicated its intention to apply to the CRTC to acquire more shares to increase its stake in Look to 32.5%. The commission confirms that Craig has yet to submit a filing in that regard. The significant ownership stake in Look could position Craig to roll out its wireless cable and high-speed Internet service on a national scale – a move Craig’s president and CEO has already hinted at. In a story published in the Winnipeg Free Press last month, Boyd Craig noted that he would like to take the company national and said he planned to talk to Look about possibly merging its eastern Canadian operations with Craig in the West. Craig didn’t return repeated calls for inquiries into its national strategy. Michael Cytrynbaum, chair of Look’s board of directors, tells Report on Wireless that the two companies aren’t talking. "Look is not in talks with Craig," he states. While Craig explores national aspirations, the company has had problems rolling out its service in British Columbia. The wireless cable and high-speed Internet service provider has twice applied for and received rollout extensions from the CRTC (RoW, July 22/02 and Aug. 21/01). When the CRTC awarded Craig a multipoint distribution system (MDS) licence for B.C. in 2000, the company was to have rolled out service in five major centres by the summer of 2001 (RoW, July 24/00). The last extension gave Craig until Dec. 31, 2002 to roll out its MDS services. CRTC sources report that Boyd Craig indicated in a phone message that the service had launched, but that there wouldn’t be regular customer service until all the details have been worked out. The CRTC also notes that Craig hasn’t applied for another extension. The details likely refer to Craig’s ongoing testing of the system, which uses customer premise equipment from IPWireless Inc. of San Bruno CA. The U.S.-based firm offers a self-install non-line-of-sight (NLOS) system, which is considered a second-generation NLOS technology. Look’s ownership structure a stumbling blockIf Craig is indeed preparing to take a run at acquiring a controlling interest in Look, the western-based operator may face an uphill battle in convincing Sirois, Look’s largest shareholder. Through his private holding company, Sirois controls approximately 39% of Look. BCE Inc., through Teleglobe, and Telesystem had previously agreed to vote with the board and management on any decisions requiring shareholder approval (RoW, Dec. 11/01). That means Craig would have to convince the board and Look’s management that a merger would be positive for both companies. Sirois’ once large and venerable wireless empire, which included operations in Canada, the United Kingdom and eastern Europe, has since crumbled in the telecom meltdown. From that standpoint, he may decide to hold onto his Look interest. On the other side of the coin, however, Sirois may decide to cut his losses to focus on struggling Microcell Telecommunications Inc. and Inukshuk Internet Inc. For more on this story, please refer to the Jan. 30/03 issue of Report on Wireless affiliate publication Canadian Communications Reports.

Craig Wireless acquires Teleglobe interest in Look Communications

News | 02/04/2003 5:00 am EST

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