Interesting story in the Financial Post last week with a connection to one of Vancouver’s earliest dot-com high-fliers.
In a piece titled Spectrum values compared, Barry Critchley compares two recent instances where wireless spectrum was sold. Critchley points out that spectrum sales of this type are very ucommon but that these two sales had a couple things in common – the buyer and the sale price.
Last year LOOK Communications received $80 Million from Inukshuk Wireless Partnership for their 92 MHz of spectrum, which covered about 91% of the population of Ontario and Quebec. And last month Craig Wireless received $80 Million from Inukshuk as well but for less spectrum in Manitoba and BC.
LOOK Communications has a storied past that includes merging with Vancouver’s Internet Direct in 1999, filing for Bankruptcy in 2001, and then being acquired by Unique Broadband Systems in 2003.
At the heart of Critchley’s spectrum valuation piece is the fact that the spectrum selling companies may have had different objectives when it came to maximizing shareholder value in the transaction.
For LOOK, that sale became the basis for rather hefty payments to its senior officers and directors. In all, $17.4-million made its way to that group, with executive chairman Michael Cytrynbaum, chief executive Gerald McGoey and chief technology analyst Alex Dolgonos pocketing $4.4-million, $5.6-million and $4-million, respectively. Three other directors — Scott Colbran, Louis Mitrovich and Stuart Smith — received $225,367, $227,367 and $227, 367, respectively. Only two of LOOK’s five directors own any shares. The two own 45,454 shares. LOOK has 127.5 million shares outstanding.
We may hear more yet from LOOK’s shareholders on this issue.