Bell Aliant expands its reach in Northwestern Ontario with $27M purchase of KMTS
From the Kenora Daily Miner and News ...
KMTS sold - Bell Aliant bid of $27 million has the vote of city council
By Mike Aiken - January 03, 2008
With competition in the telecommunications sector getting tougher in the local market, city council has decided to sell one of its key assets.
Since the arrival of Shaw and TBay Tel in recent months, councillors felt they had to decide between making major investments to compete with bigger companies, or sell to a willing partner.
At a special meeting Thursday morning in council chambers, Coun. Andrew Poirier said the time was right for the sale.
“We believe we’ve maximized the return on our asset,” he said, during a brief interview following the meeting.
A public information meeting is set for Jan. 15 beginning at 7 p.m. at the Best Western Lakeside Inn, where residents will be able to get more details on the sale.
Following the two-hour meeting, council will proceed with their resolution to sell the company.
Poirier said there was a commitment from Bell to keep local jobs.
“Bell Aliant is offering employment to all current KMTS staff here in Kenora. As well, Bell Aliant is committed to providing an overall benefit and compensation package that is comparable to, or better than, what local employees currently enjoy,” the corporation said in a prepared statement released by the city Thursday.
The press release said the local management and service team will stay in place, along with the KMTS brand.
Proceeds from the sale, $27 million, in addition to $26 million already in city reserves, will be combined into a newly-created prosperity fund, Poirier said, noting a professional investment advisor is meeting with council later this month in order to advise them of the best strategies for managing the fund.
KMTS served the area for more than a century. Started in 1902 with the purchase of the local telephone exchange from its private founders, it was one of a handful of remaining municipally-owned independents in Canada.
In recent years, decisions by the federal government altered the rules governing local competition, making it increasing difficult for for small, locally owned utilities to compete.