BCE shares jump on report of new solvency opinion
Last Updated: Monday, December 8, 2008 | 5:56 PM ET
The Canadian Press
Shares of BCE Inc. spiked Monday amid reports it has a second opinion on its financial health contradicting the earlier analysis that threatens a $52-billion deal to privatize the company.
BCE stock closed up $1.80 at $24.65, a gain of more than 7.8 per cent. The shares traded as high as $27.57 in the last minutes of the session after trading below $23 most of the day.
Bloomberg reported Monday afternoon that BCE has told its would-be acquirers that it has an opinion by PricewaterhouseCoopers LLP that says the company would be solvent after the deal closes.
That's contrary to a preliminary report by KPMG, which determined that the company, owner of Bell Canada, wouldn't pass a solvency test required as a condition of closing the deal.
The KPMG opinion had appeared to deliver a fatal blow to the long-delayed takeover and privatizing of Canada's largest telecommunications company by the Ontario Teachers' Pension Plan and its three U.S. private-equity partners.
The deal offering $42.75 per share is set to expire Thursday.
Officials from BCE, Teachers and PricewaterhouseCoopers didn't returns calls seeking comment on the report.
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