Accelero Capital Holdings has agreed to purchase the Allstream business unit from Manitoba Telecom Services (MTS).

The transaction values Toronto-based Allstream, formerly AT&T Canada, at $520 million.

Allstream provides enterprise-focused communications solutions to more than 50,000 businesses and employs 2,000.

Naguib Sawiris, Accelero's Non-Executive Chairman and Co-Founder, who has overseen more than $1 billion of investment in the Canadian telecommunications market, is excited at the new prospect.

"This investment reflects Accelero's long-term commitment to the Canadian telecommunications market, and our belief in the opportunity that exists to provide capital to enhance the competitive landscape in Canada. Allstream is the leading competitor to the incumbents in the Canadian enterprise market, and a fast-growing player in the IP space with an advanced coast-to-coast fiber network," Sawiris said.

In addition to Sawiris' contributions, Accelero was established by former Orascom Telecom, Wind Telecom and VimpelCom executives including Ossama Bessada, Khaled Bichara, and Aldo Mareuse.

MTS will be contributing $130 million from the sale to its pension plan, pay $70 million in short-term debt and invest a significant amount to acquire wireless spectrum and upgrade its existing mobile networks.

Discuss this further in our MTS forum.