BCE sale could be pushed to June by bondholder appeal

BCE, the parent of Bell Canada and Bell Aliant, has rescheduled the expected closing date of its agreed CAD52 billion (USD52.2 billion) leveraged buyout to ‘before the end of the second quarter’, reports the Toronto Star. Canada’s largest telecoms group said yesterday that an appeal against a 7 March court ruling lodged by Bell bondholders unhappy with the deal means that its original forecasted completion date of early-to-mid second quarter could not be guaranteed. The news pushes it perilously close to the self-imposed 30 June deadline for completing the transaction. The Star reports that the bondholders are seeking to block the takeover, led by the Ontario Teachers’ Pension Plan, because it loads the firm’s balance sheet up with debt, making their investments much riskier. BCE said the Court of Appeal schedule promises a quick decision after a week of hearings that begin on 28 April. Company officials noted their revamped timeline also takes into consideration the possibility the case could be taken to the Supreme Court. BCE’s legal spokesperson reiterated an official position that the bondholders’ petition is without merit and that BCE is confident the sale will be wrapped up before mid-year. The final hurdle for the consortium buyout, which also involves equity groups Providence, Madison Dearborn and Merrill Lynch Global, is the awaited approval from Canadian telecoms and broadcasting regulator CRTC.