Mobilicity gets more time in creditor protection

Struggling small wireless operator Mobilicity has been granted a longer period by an Ontario court to restructure its business or complete a sale of its assets.

Mobilicity was granted protection under the Companies Creditors Arrangement Act in September and the court order Thursday extends that protection until Dec. 20.

The ruling means that Mobilicity is shielded from creditors and can offer business as usual to its wireless customers.

Telus tried to buy Mobilicity for $380 million earlier this year but the transaction was rejected by Industry Canada in June because the small company's licence for spectrum radio waves needed to operate cellphones doesn't expire until next February, which would complicate a sale.

A condition of Mobilicity's entry as a new wireless player in Canada almost five years ago was that its spectrum licence could not be sold before it expired.

However, in appealing to the court, Mobilicity said it is still attempting to sell the company and is in talks with Industry Canada on a deal. It would not name who was trying to buy it.

"We've never disclosed who the prospective purchaser is," lawyer Orestes Pasparakis said Thursday.

"The company is in discussion with Industry Canada (about the proposed deal) and those discussions are continuing," Pasparakis said.

A Telus takeover of Public Mobile, another small operator, was granted approval earlier this week.

Mobilicitys president and chief operating officer Stewart Lyons is preparing to leave the company at the end of this month.

The Toronto company, which launched in 2010, has about 215,000 no-contract cellphone customers and operates in Toronto, Ottawa, Calgary, Edmonton and Vancouver.