February 4, 2015
1670
In a narrow, 5-4 recorded vote, Kincardine council has agreed to find out the current status of the proposed sale of Bruce Telecom to Bragg Communications (Eastlink).
Announced last January, the deal was scuttled in August after the Competition Bureau refused to allow the sale, stating it would have likely resulted in higher prices and fewer choices for the residents of Port Elgin and Paisley.
In committee-of-the-whole last night (Feb. 4), council discussed a motion put forward by councillor Laura Haight which directs the mayor “to engage Bragg Communications to determine what potential value could be determined under the terms of the agreement respecting the sale of Bruce Telecom or if any options are available to the parties to mitigate the issues raised by the Competition Bureau.”
The motion adds that the consultants, Accelerator Strategies and TMT, be retained to assist the mayor in these discussions; that council is desirous of this information in order to fully assess any path forward with respect to either proceeding with the sale of Bruce Telecom or continuation of the company; and that this resolution does not represent or indicate any commitment by council, at this time, to proceed with the sale. A report to council is to be provided with respect to these discussions.
Prior to debate on the motion, mayor Anne Eadie said that former mayor Larry Kraemer had reminded council in the fall that he had been talking with Bragg Communications and the company had said, at that time, it was interested in a new deal if the concerns of the Competition Bureau could be addressed. Bragg Communications was told that, because of the election and new members on council, the municipality would respond to this show of interest, in the new year.
Haight said it's important that council has all the current information before making a decision on the path forward for Bruce Telecom.
“If the deal with Eastlink is done, fine,” she said. “But I'd like to have that firm communication from Eastlink that the deal is, in fact, dead. What would an alternate deal look like? I'd like to know that so we can assess other proposals.”
Councillor Randy Roppel objected, saying council does not own the company, the people of Kincardine do.
“The people have the right to know, but we can't tell them anything because everything is held in secret,” he said. “Now we hear that Eastlink wants to re-negotiate. If they're that damned interested, they should show up. You're asking the municipality to spend more money to find out what the company wants. We're already in the hole for $1.2-million; now, you want to add to that, to gain what? Cut our losses; are we selling the company or not?”
He added the waffling about the sale of Bruce Telecom is costing the company business. “We didn't stop the deal, they (Bragg Communications) did.”
“They were told that because of the election and new council, they were to wait until they heard from us,” replied Eadie. “Whether you (Roppel) heard it last fall or not, that's what we were told – we would contact them in the new year.”
“This motion actually agrees with you Randy (Roppel),” said deputy mayor Jacqueline Faubert. “This gets everything out in the open, and the information out to the public. It's a good process. I'm concerned about the timeline; how long will this take?”
Eadie said she could call Bragg Communications on Friday (Feb. 6) to see if the company is still interested purchasing Bruce Telecom, and to see if another deal could be negotiated.
“The first step is to confirm what was said last fall,” she said, “or if they've changed their minds. If they say yes, they're interested, then we follow the motion, engage them in discussion and see if there are any possibilities.”
“There are provisions in that purchase agreement,” said Haight. “I saw it. The administrative timeline for this would be a year to 18 months.”
In response to Roppel's argument about who owns the phone company, Haight said that it is owned by the people of Kincardine, “but we are the people's representatives and it's our responsibility to do this (process).”
“It's all about due diligence,” agreed councillor Andrew White. “There's no business that's not for sale when money is on the table.”
“Our challenge,” said councillor Linda McKee, “is to ask the question if Bragg Communications is still interested. I have a problem with doing that over the phone because there are a lot of technical issues involved in this. From the letter I read, they weren't interested.”
“Council already decided to sell Bruce Telecom,” said Haight. “Just because we had an election, doesn't change the fact that we still have an agreement on the table and it has options to it.”
“We have to be fiscally responsible and make a decision on this,” said Eadie. “We have to explore the avenues and approach it as a business because it is a business. How we got here is not important; now, we have to choose a path forward.”
The motion was approved, 5-4, by a recorded vote. In favour, were Faubert, Haight, White, Eadie and councillor Maureen Couture; while against, were Roppel, McKee, and councillors Mike Leggett and Gordon Campbell.
Written ByLiz Dadson is the founder and editor of the Kincardine Record and has been in the news business since 1986.
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