While 27 applicants are vying for a piece of wireless spectrum to be auctioned off by Industry Canada at the end of May, entrepreneur Anthony Lacavera has something most of them don’t: the backing of two billionaires with actual experience in the wireless industry.
Lacavera is the founder and CEO of Globalive Communications Corp., a private Toronto-based company that provides home phone, long-distance calling and Internet services for about one million residential customers under its Yak brand. Globalive submitted a $235-million deposit to Industry Canada along with two other firms, Weather Investments and Novator, in hopes of becoming a new player in Canada’s cellphone market. Egyptian billionaire Naguib Sawiris, with a net worth of US$12.7 billion, controls Weather Investments, and Iceland native Bjorgolfur Thor Bjorgolfsson, worth US$3.5 billion, is the entrepreneur behind Novator.
So how did a Canadian company with only $125 million in annual revenue attract such heavyweight partners? To hear Lacavera talk, it wasn’t that difficult. The 34-year-old says he got in touch with the advisory boards of both companies back in January, and had everything in place by March. “Both of them were already looking at Canada as a potential opportunity for wireless, given the very high pricing and the very low penetration here,” Lacavera says. He had to search abroad for partners since there were no Canadian investors that had both the necessary cash and experience in the industry, whereas Sawiris operates wireless companies in Italy and Greece, and Bjorgolfsson has been involved in telecom plays in Iceland and throughout Europe.
Should Globalive be successful in its bid, the company plans to use the spectrum to launch multiple wireless brands. And how high could prices go for spectrum? That’s anyone’s guess, Lacavera says. “It’ll be anywhere from the opening bid to a number I can’t afford.”