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Strategies & Market Trends : Technical analysis for shorts & longs
SPY 680.59+0.6%Dec 19 4:00 PM EST
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To: Johnny Canuck who wrote (32844)6/17/2001 3:32:40 AM
From: Johnny Canuck  Read Replies (1) of 69160
 
Say Goodbye to the Wireless Pure Play

Steve Maich
The Financial Post
Thursday, June 14


Investment options in Canada's wireless phone industry are about to get a lot more limited, another indication of the market's souring attitude toward cash-poor businesses, analysts say.
It's the end of an era after Rogers Communications Inc.'s [T.RCI.A] bid on Tuesday to take its mobile phone unit [T.RCM.B] private, leaving Microcell Telecommunications Inc. [T.MTI.B] slated to be the only pure play wireless stock in Canada.

"The allure of the wireless sector has disappeared in the past year," said Nick Strube, an analyst with Canaccord Capital Corp. "Financing of the networks is expensive and the new applications won't sell as simply as people thought." "The allure of the wireless sector has disappeared in the past year."



With costs and debt mounting, Rogers has decided to follow the lead of rivals BCE Inc. [T.BCE] and Telus Corp. [T.T] by running its cellphone business within a larger parent company.

By operating within a conglomerate, cash flow from other lines of business can support the capital demands of building a wireless network.


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