Second opinion needed to upgrade BCE deal condition from 'dead' to 'alive'

10 Dec 2008

Canadian telecoms group BCE has hired consultancy PricewaterhouseCoopers to help it rescue a deal to take itself private, which has been under threat since BCE’s hired auditor KPMG warned that the CAD34.8 billion (USD28.1 billion) cash and debt transaction would leave the company insolvent. BCE, the parent of Bell Canada and Bell Aliant, has agreed to be bought out by a consortium led by the Ontario Teachers’ Pension Plan Board and several US equity partners, but to close the deal tomorrow (11 December) as scheduled, KPMG must sign off on the solvency opinion. Late last month the auditor said BCE might not meet solvency criteria set in the buyout agreement ‘based on current market conditions and the amount of indebtedness involved in the financing.’