Investors Disappointed by New BCE Timeline

Since the Quebec Court of Appeal will not hear an appeal from BCE Inc. (BCE) bondholders until April 28, with as many as three and a half days of hearings over a maximum five-day period, BCE now expects its buyout to close before the end of the second quarter. Its previous expectation was early in the quarter, Desjardins Securities analyst Joseph MacKay told clients in a note.

“The new timeline now pushes up against the June 30, 2008 deal deadline date,” he said, noting that while this outside date can be extended by up to three months, uncertainty in the credit markets mean the new timeline is a disappointment for investors.

BCE shares were down 3% to around C$36.50 in Wednesday morning trading in Toronto.

Nonetheless, Mr. MacKay thinks the deal will close under its current terms of C$42.75 per share, and the Appeals Courts judge will ensure that the timing of the ruling does not put the transaction at risk.