Shares of takeover target BCE Inc. fell Wednesday after reports of a financing roadblock in another big leveraged buyout south of the border rattled investors.

BCE stock dropped 97 cents to close at $35.72 on the TSX.

BCE 3-month chart

The slide followed media reports that a number of European and U.S. banks that were to provide financing in the $20-billion US takeover of Clear Channel Communications are having second thoughts.

Some of the same foreign banks have signed on to provide financing for the BCE deal.

Paul Kedrosky, director of research for the hedge fund Ten Asset Management, told CBC News the Clear Channel and BCE deals are "strikingly similar."

"You've got all the same moving parts and all the same problems, which are that the banks and the providers of the money to make the deal work don't want to provide it any more because what looked good a while ago … doesn't look nearly as good now," he said.

When asked whether he had advice for BCE shareholders, Kedrosky said, "If you're holding [BCE] only in anticipation of the completion of this deal, I would find something else to do."

A consortium led by the Ontario Teachers' Pension Plan offered $42.75 a share for BCE in a deal that was announced last June.

But the stock has traded far below the takeover price on concern that the difficulties in global credit markets will jeopardize the financing needed for the takeover, or at least force a reworking of the terms.

For their parts, both BCE and Teachers' have insisted the takeover remains on course.

"We are working to close the BCE transaction and we expect our banks will honour their financing obligations," Deborah Allan, a spokeswoman for Teachers' told CBC News Wednesday.

On Tuesday, a BCE spokesperson told Reuters that the buyout remains on track for a scheduled closing near the end of the second quarter.

The BCE takeover still requires CRTC approval. The chair of the regulator has asked for further assurances that the telecom will remain under Canadian control.

The CRTC said late Wednesday it will announce its decision on the BCE takeover at 4 p.m. ET on Thursday.