BCE decision coming down the pipe today

Today's the day the Supreme Court of Canada decides whether the parent company of Bell Canada-BCE--treated its bondholders unfairly when it agreed to be purchased by a group led by the Ottawa Teacher's Pension Plan for $34.5 billion. At issue is whether the deal puts the value of existing bonds at risk by adding a massive amount of new debt to Bell's ledger to facilitate the takeover.

The bid for Bell-Canada's largest telephone company-is C$42.75 a share, but with the credit market contagion still dampening borrowing and Bell currently trading at just C$34.68, you have to wonder just how hard the Teacher's Pension Plan and its U.S. private equity partners, Providence Equity Partners, Madison Dearborn Partners and Merrill Lynch Global Private Equity, are pulling for the court to decide in their favor, especially with major lender Citigroup suffering recurring lapses of credit fever . This may be the biggest leveraged buyout in history, but it could end up being the biggest bust as well.

Also on the table is a C$1 billion fee if the deal doesn't go forward, payable by the consortium led by the TPP, which also is currently holding a 6% stake  in Bell.

For more:
- See the Toronto Globe & Mail story [1]

Related articles:
Bell Canada fights time, financial challenges to deal Bell report [2]
Bell Canada bondholders became riled up last summer, and eventually sued. Bell Canada report [3]
The Bell Canada deal was stalled by credit market worries last week. Bell Canada report [4]