Troubled Canadian operator Mobilicity filed for and received creditor protection, as it looks to complete a deal which would keep it as a going concern.

The company said that a transaction with an unnamed partner is currently before regulator Industry Canada for a review. In the meantime, Ernst & Young has been appointed as a “Monitor” to assist the company and its stakeholders, and debtor-in-possession finance from existing noteholders to the tune of CAD30 million is also in place.

Mobilicity had previously inked a deal with big-three player Telus. However, this fell through after a review by Industry Canada, because Mobilicity operates using spectrum which was reserved for new entrants, which cannot currently be transferred to one of the existing, dominant operators.

The troubled operator was subsequently linked with US operator Verizon Wireless, which does not already have a mobile business in Canada, and would therefore not be hamstrung by the same spectrum ownership rules.

However, this now appears to be on the backburner, pending a spectrum auction which is due to take place early next year.