Saturday, November 22nd0.3°C
24124
24165

BCE buying stake in Bell Aliant it doesn't already own and will keep the brand

MONTREAL - Canada's biggest telecom company, BCE Inc., is buying the stake in Bell Aliant that it doesn't already own for $3.95 billion in cash and stock, but will keep the brand's presence in Atlantic Canada.

BCE Inc. (TSX:BCE), which already owns 44 per cent of Bell Aliant, announced the plan to take the company private with an offer worth $31 per share.

"The Bell Aliant brand will stay where it is," Bell Aliant chief executive Karen Sheriff said Wednesday on a conference call to provide details about the deal.

"The Bell Aliant headquarters will stay where it is," Sheriff said. "I think what this really does is take that local expertise and commitment that we've always had and put the full backing behind us of BCE to make us very, very strong as we move forward to help us keep being the `preferred guy' in each of our local markets."

No job cuts were announced as a result of the deal.

Under the offer, Bell Aliant shareholders may choose between $31 in cash, 0.6371 of a BCE common share or a combination of cash and stock. BCE said the total amount paid will be 25 per cent in cash and 75 per cent in shares.

Bell Aliant (TSX:BA) provides television, Internet and phone services.

BCE said the company will continue to serve customers in New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island from its Halifax headquarters. Bell Aliant also has regional telecom operations in rural Ontario and Quebec.

BCE chief executive George Cope said bringing Bell Aliant fully into BCE simplifies the its structure and eliminates the costs of running two publicly traded companies.

BCE also announced on Wednesday the acquisition of two call centres in New Brunswick, which will serve Bell Canada customers and add an additional 700 jobs to Bell Canada.

The move came as BCE continued its expansion of its high-speed LTE wireless network to more than 100 additional communities in Atlantic Canada that will be completed by the end of 2015.

BCE said it plans a capital investment of $2.1 billion across Atlantic Canada over the next five years to continue the roll out broadband wireline and wireless for consumers and business users.

Canaccord Genuity analyst Dvai Ghose wasn't surprised by BCE's announcement.

"The deal has been speculated for a long time, does not require regulatory approvals, as BCE already controls Bell Aliant, and is at the high end of the fairness approval range, we assume a quick close," Ghose wrote in a research note.

Ghose also said the deal should be financially advantageous for BCE and also should help it raise its dividend in 2015.

"But deal will also have a negative impact on BCE's asset mix and growth and highlights BCE's weakness," he said.

"Consequently as with the CTV and Astral acquisitions, we envisage near-to-medium term accretion but longer term declines. The deal therefore suggests to us that BCE has to continue to acquire to grow dividends, unlike its nearest peer Telus which has targeted at least 10 per cent annual DPS (dividend) growth to 2016."

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX15111.13+35.95
S&P CDNX789.135.56
DJIA17810.0691.06
Nasdaq4712.97+11.102
S&P 5002063.50+10.75
CDN Dollar0.8901-0.0002
Gold1201.50+10.60
Oil76.72+0.87
Lumber331.50+4.50
Natural Gas4.236-0.253

 
Okanagan Companies
Pacific Safety0.155-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.30+0.03
Cantex0.04+0.005
Anavex Life Sciences0.178+0.008
Metalex Ventures0.03+0.005
Russel Metals31.62+0.82
Copper Mountain Mining2.24+0.06
Colorado Resources0.125-0.015
ReliaBrand Inc0.013-0.002
Sunrise Resources Ltd0.050.00
Mission Ready Services0.35+0.015

 
23744


24120

FEATURED Property
2127533520 Caramillo Court
4 bedrooms 6 baths
$849,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


What I learned in China: Part 2

As per my previous article on my visit to China, we have much to learn about and from their people. It is potentially the largest market on earth with 1.3 billion people in one country but much will d...


Retirement: Health Issues

Our health is really our greatest asset and maintaining our health is of tremendous importance. You want to do what you can to ensure that health issues will not jeopardize the enjoyment of your retir...


Be quiet already!

No, you’re not crazy. There really are voices in your head. Voices that keep you from doing what you need to do during your customer care calls. It can be the voice of your teachers, your parent...

_



24207

24207


Member of BC Press Council


22842