Bruce Telecom agreement not terminated, says municipality

Section: 
News

 Contrary to a report issued by the Competition Bureau, the sale of Bruce Telecom to Eastlink is still in process, according to the Municipality of Kincardine.

 

The municipality issued its own media release Friday afternoon, responding to a release from the federal bureau, which stated that the pending acquisition of the telecommunications by Eastlink had been terminated.

 

According to a media release from the Bureau, the companies decided to cancel the sale after review by the federal department’s mergers branch determined that acquisition of the municipally-owned telecommunications company by Eastlink would create a monopoly. The Bureau stated that if the acquisition proceeded as proposed, “it would have likely resulted in a substantial lessening or prevention of competition in the towns of Port Elgin and Paisley where the two firms are the only providers of wireline telecommunications services.”

 

Eastlink, owned by Bragg Communications, operates more than 500 cable systems throughout Canada. In Port Elgin and Paisley, it provides telephone, cable television and Internet service in direct competition with Bruce Telecom.

 

Bruce Telecom has operated in Kincardine and the surrounding area for more than 100 years and provides telephone, cable and broadband Internet services.

 

“Our review concluded that Eastlink’s acquisition of Bruce Telecom would have likely resulted in higher prices and fewer choices for the supply of telecommunications services to the residents of the towns of Port Elgin and Paisley,” John Pecman, commissioner of competition, said in the release. “In the absence of the dynamic rivalry that exists between Eastlink and Bruce Telecom, customers would also been deprived of the benefits of innovation in their telecommunications services.”

 

In its media release, the municipality responded to the announcement.

 

“This press release was issued without notice to or consultation with the Municipality of Kincardine and contains inaccuracies. Contrary to the press release, the parties have not terminated their agreement. As well, it is not true that the Municipality of Kincardine has decided to abandon the proposed transaction. Council for the municipality has not received nor had an opportunity to consider the subject matter of the Bureau's press release. The Municipality of Kincardine is seeking a correction from the Bureau.”

 

A public meeting scheduled for Aug. 27 to discuss an investigation report into closed door meetings over the sale will go ahead as planned.