Egyptian telecom tycoon Naguib Sawiris said he will never pursue any investments in Canada after Accelero Capital Holdings' $540 million bid to acquire business service provider Allstream was blocked by the Canadian government last week.
"I am finished with Canada, I tell you," he told Ahram Online.
Both Sawiris and MTS, Allstream's parent company, expressed disappointment over the government's decision.
The Canadian government said that the deal did not meet the "net benefit" of the Investment Canada Act, which allowed them to veto it based on national security concerns.
Interestingly, the veto of the Allstream transaction comes after a decision made by Canada's parliament last June to relax foreign ownership rules set in the country's Telecommunications Act. The rules allow foreign control of service providers that have less than ten percent market share by revenue.
Sawaris said he would not sue the government, but added the decision shows that Canada's incumbent telcos "again won through lobbying to push competition out of the market."
This failed deal also has implications for MTS, which said it would again report Allstream as part of its consolidated results and that these results would be impacted by about $35 million of non-recoverable, transaction-related expenses and restricting costs.
- Amwal Al Ghad has this article
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