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NDP leader knocks NovAtel ‘giveaway’□ Company reportedly negotiating buyout deal with Northern TelecomEDMONTON (CP) — The Alberta government is preparing to “give away” money-losing NovAtel Communications for as little as one-fifth of what it cost, NDP Leader Ray Martin said Monday.“I don’t know what the options are, but it certainly looks like a giveaway,” Martin said.He was commenting on a report NovAtel is negotiating with its chief competitor, Northern Telecom Ltd., for a $30-million buyout.The government bought the company for about $160 million two years ago and has also covered its losses and provided extensive loan guarantees. NovAtel manufactures cellular phones and phone systems at its plant in Lethbridge.NovAtel president Jim McDonald said the firm hasbeen meeting “with many interested parties” but he wouldn’t be specific. Neither would he discuss a price.The Globe and Mail newspaper said on the weekend that unofficial NovAtel correspondence pointed to a possible sale to Northern Telecom for as little as $30 million.“I’m not aware of any report,” McDonald said.In the provincial legislature, Martin asked for confirmation the company is being sold for a sizeable loss.Treasurer Dick Johnston said the report was just speculation. Technology Minister Fred Stewart was not in the house.City of Lethbridge economic development officer Dave Berlando said he’s heard rumors of impending NovAtel sales before, and is not prepared to speculate about unsubstantiated reports.“It’s been in the news and bantered about for solong,” he said today. “So many stories have gone so far and then stopped.”Berlando said it would be unproductive to try to guess what a buyer’s corporate direction will be, considering the unlimited options to be chosen from.“It’s anybody’s guess,” he said. “We’re told now by local management there’s no immediate changes expected in the future, and they’ve got 450 employees there now who are busy as heck.”NovAtel was started up eight years ago as a subsidiary of Alberta Government Telephones, now Telus Corp. It was included in the Telus privatization in the fall of 1990 but the government was forced to buy it back for $159.4 million because a faulty prospectus projected a profit, which turned out to be a $204 million loss.The province has also provided NovAtel a $525 million loan guarantee as well as a $185 million line of credit.
Newspaper Details
Lethbridge Herald
Lethbridge, Alberta, CA
Tue, Apr 07, 1992
Page 1
Full Page
Clipped by
Chinook A.
AB, USA 24 Nov 2022
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