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UPDATE 2-Canada's Telus to divest stake in unit, posts lower profit

Published 2016-05-05, 07:36 a/m
© Reuters. UPDATE 2-Canada's Telus to divest stake in unit, posts lower profit
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May 5 (Reuters) - Telus Corp T.TO TU.N , one of Canada's
three big telecom providers, said it would sell a 35 percent
stake in outsourcing service provider Telus International, and
plans to use the proceeds to expand its wireless and wireline
networks.
Competition among Canadian telecom companies has been
heating up, sparked by deals including Shaw Communications Inc's
SJRb.TO SJR.N acquisition of Wind Mobile, the country's
fourth-largest wireless provider, and Rogers Communications
Inc's RCIb.TO C$465-million purchase of smaller rival
Mobilicity.
Telus on Monday entered an agreement with rival BCE Inc
BCE.TO to buy one-third of Manitoba Telecom Services' (MTS)
MBT.TO post-paid wireless subscribers, after BCE completes its
deal to buy MTS.
Vancouver-based Telus said on Thursday it would sell the
stake in Telus International to Baring Private Equity Asia for
proceeds of about C$600 million ($467.14 million), in a deal
valuing the unit at C$1.2 billion.
The company also posted a lower profit due to higher costs,
sagging demand in Alberta, Canada's oil producing hub, and
fierce competition for wireless customers.
Telus's net income fell to C$378 million, or 64 Canadian
cents per share, in the first quarter ended March 31, from C$415
million, or 68 Canadian cents per share, a year earlier.

However, operating revenue rose to C$3.11 billion from
C$3.03 billion, helped by growth in wireless and wireline
operations.
Blended churn rate, or the number of customer cancellations,
in the quarter was the company's lowest first quarter churn rate
in 16 years, Telus said.
($1 = 1.28 Canadian dollars)

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