BCE buyout still on track

Canada’s largest telecoms group BCE has reported that the Saskatchewan Court of Queen’s Bench has refused to grant an injunction to halt the company’s pending takeover deal, reports thecanadianpress.com. The court order had been sought by shareholders unhappy that CAD600 million (USD501 million) of dividends were cancelled to smooth the way for the buyout. Meanwhile, BCE and its largest subsidiary, Bell Canada, have launched cash tender offers for about CAD1.95 billion of debt in a step towards the completion of the group’s takeover and de-listing by a group led by the Ontario Teachers’ Pension Plan, backed by US equity firms Providence, Madison Dearborn and Merrill Lynch. The CAD52 billion acquisition, the largest corporate buyout in Canadian history, has suffered persistent rumours that it will be derailed by the ongoing financial crisis before its scheduled closing on 11 December 2008. BCE is offering to buy CAD650 million in outstanding debentures due in October 2009 whilst Bell Canada is offering to buy CAD700 million of debentures due June 2009 and CAD600 million of debentures due August 2010. The tender offers are conditional on the completion of the privatisation deal.