Bell Canada parent company BCE Inc. BCE-T is selling its land mobile radio network business to a subsidiary of American technology company Motorola Solutions MSI-N for $675-million, part of the company’s plan to sell $7-billion in assets to pay down debt.
Land mobile radio is a two-way communication technology between radio receivers, often used by government agencies and commercial entities.
The business, which it will sell to Motorola Solutions Canada Networks Inc., includes a mix of partnerships with governments and businesses and physical assets across Bell’s wireline footprint, from Manitoba eastward.
Bell spokesperson Ellen Murphy said the company plans to use the proceeds of the deal to deleverage and strengthen its balance sheet.
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The company expects the deal to close in the fourth quarter of 2026, subject to regulatory and third-party approvals, it said in a release after markets Thursday.
Analysts reacted positively to the divestiture.
“While small, this transaction does reinforce BCE’s commitment to debt reduction targets,” said Bank of Montreal analyst Tim Casey in a note to investors Thursday evening.
“The sale focuses on a legacy asset that generates stable revenue but is not considered a primary growth area and does not involve giving away core customer relationships,” said Maher Yaghi, a Bank of Nova Scotia analyst, in a note.
The assets do not include mobile wireless spectrum, Mr. Yaghi added.
According to National Bank of Canada analyst Adam Shine, the land radio business generated revenues of about $250-million and earnings before interest, taxes, depreciation, and amortization of about $70-million.
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Motorola was deemed “the natural buyer” for the assets, as it is already a primary equipment supplier for and partner for the systems, he said in a note.
Bell first announced its plan to sell $7-billion in non-core assets last year as it aims to reduce its $34-billion in long-term debt. So far, it has sold its stake in Maple Leaf Sports & Entertainment for $4.7-billion and a home security business for $170-million.
It also plans to sell its northern telecom network Northwestel for $1-billion, but that deal has stalled as the buyer, Sixty North Unity, seeks funding.
When including the land mobile radio network, this means that Bell has yet to publicly identify about $450-million of the total $7-billion in assets it plans to sell.
The Bank of Montreal is serving as financial adviser to Bell, and Gowlings WLG is its legal adviser.