Canada's Shaw Communications Inc (SJRb.TO) said on Tuesday it would sell its data center subsidiary ViaWest Inc to Peak 10 Holding Corp for US$1.675 billion, using some of the proceeds to buy airwaves to boost its new wireless unit.

Shaw said it would pay $430 million to acquire wireless spectrum from Quebecor Media Inc, which is majority-owned by Quebecor Inc (QBRb.TO), for use in its home markets in Alberta and British Columbia as well as in southern Ontario.

The moves are the latest one-two M&A punch from Shaw, after early last year selling its media assets to sister company Corus Entertainment and acquiring Wind Mobile, which it rebranded as Freedom Mobile in November.

Shares of both Shaw and Quebecor jumped after the news, with Shaw up 4.2 per cent to $29.75 and Quebecor up 1.9 per cent at $41.35 in morning trade.

"It was a good price (for ViaWest), a good strategic move to focus back onto the core," said Jeff Fan, a telecom analyst at Scotiabank, adding that the price they paid for the Quebecor spectrum was at the high end of his expected range.

Calgary-based Shaw is locked in a fierce battle for internet, television and telephone customers in the west of the country with Vancouver-based rival Telus Corp (T.TO).

"Just by getting low-band spectrum it's not going to put them on equal footing, but it does narrow the network quality gap quite significantly," Scotiabank's Fan said.

The spectrum transaction requires approvals from a competition watchdog and the government, and is expected to close this summer.

Analysts were calling on Shaw to sell its data center business after U.S. telecommunications firms Verizon Communications Inc (VZ.N) and CenturyLink Inc (CTL.N) reaped several billions of dollars after agreeing to sell their portfolios last year.

Shaw bought ViaWest from private equity firms Oak Hill Capital Partners and GI Partners for about US$1.2 billion three years ago. Peak 10 Holding is owned by GI Partners.

ViaWest is a Colorado-based data center company which offers hybrid IT and cloud-based solutions. It owns about 30 data centers in several U.S. states including Colorado, Nevada and Minnesota.

Reuters reported in April that Shaw was looking for a buyer for ViaWest and was expecting a higher price than its original investment.

TD Securities acted as exclusive financial adviser and Paul, Weiss, Rifkind, Wharton & Garrison LLP and Dentons Canada LLP provided legal advice, Shaw said.