Deal to privatize Canada's BCE dead
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[December 11, 2008]

Deal to privatize Canada's BCE dead

(Associated Press WorldStream Via Acquire Media NewsEdge) TORONTO_The largest leveraged buyout in Canadian history is officially dead after a group of buyers of the telecom company BCE Inc. said an audit has found the proposed $35 billion deal to take the company private did not meet solvency requirements.



An investment group led by the Ontario Teachers Pension Plan Board and several U.S. partners had expected to complete its deal for BCE, the parent of Bell Canada, on Dec. 11. It also would have been the biggest takeover in Canadian history.

But a review by accounting firm KPMG found that BCE would not meet the solvency tests of the privatization agreement, partly due to the amount of debt involved in the transaction and current market conditions. The company had to meet the solvency requirements for the acquisition to be completed.


The buyers announced the decision early Thursday.

Shareholders overwhelmingly approved the buyout group's offer of 42.75 Canadian dollars per share in September of 2007.

BCE management had agreed to the deal in June 2007, just before credit markets began to unravel in North America.

Copyright ? 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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