Manitoba Telecom Services Inc. (MTS) and Bell Canada announced today that they have created a new company by combining the interests of Bell Intrigna and Bell Nexxia in Alberta and British Columbia.
Called Bell West Inc., the new company will have a valuation of approximately $1 billion and will capitalize on what the companies are calling “the solid growth opportunities Western Canada represents for telecommunications services.”
MTS officials say the total business telecom market in Alberta and British Columbia was worth $3 billion in 2001, and is projected to grow to $4 billion in the next three to four years.
Bell West Inc. will operate under the Bell brand and will be owned 60 per cent by Bell Canada and 40 per cent by Bell partner and telecom company MTS. It will focus on businesses in Alberta and British Columbia, providing a suite of fibre-based data and IP services, as well as the full spectrum of local, long distance voice services and on outsourcing and managed services.
The new company already has 700 employees in Vancouver, Calgary and Edmonton with approximately 650 employees coming from Intrigna and 50 employees from Nexxia that will constitute the staff at Bell West.
Previously, Bell Intrigna was two-thirds owned by MTS and one-third owned by Bell. Bell Nexxia operations in Alberta and British Columbia were 100 per cent owned by Bell Canada.
Leading the new Bell company in the West is Randy Reynolds, the new president and CEO, and former president and CEO of Bell Nexxia. John Sheridan, president of Bell Canada, will become chairman of the board. The board will only be comprised of members in total.
“The adoption by the new company of Bell’s network and technology platforms as well as its product and service development engine will greatly enhance its competitiveness in the marketplace,” said John Sheridan, President of Bell Canada, in a prepared press statement.
“This initiative is an integral element of our investments in Western Canada; investments made to ensure we can serve our customers nationally, with a diversified product offering and from a common platform.”
One industry analyst said that now that Bell has clearly established itself in western Canada with contracts that include the Government of Alberta Supernet project (an ongoing project that will link the province’s government and private-sector community via a high-bandwidth pipe), the City of Calgary and privately held Crystal Decisions, it now made sense for Bell to consolidate the two companies.
“Bell didn’t know how to deal in the west so they partnered with MTS that is right next door to Alberta. They figured you take a western player and move them west, which was smart. Now it’s evolved where it’s no longer necessary to do that,” said Brownlee Thomas, research director for the Giga Information Group in Montreal.
She added that it no longer made sense to have Nexxia and Intrigna bidding on the same contracts, and have cut its costs by merging the businesses together to create one single organization under the well-recognized Bell brand.
The new company will be headquartered in Calgary with offices in Edmonton and Vancouver.
Bell Canada can be reached at http://www.bell.ca