BCE shares rise as Supreme Court agrees to speedy hearing
BCE 3-month chart
Shares of BCE jumped Tuesday after the Supreme Court of Canada agreed to fast track a hearing that could determine the fate of the biggest takeover in Canadian history.
BCE stock rose $1.09 to close at $34.85 in heavy TSX trading of 10.8 million shares.
Late Monday, the Supreme Court said it would hear arguments this month on whether it should hear an appeal of a lower court ruling that went against BCE. If it decides to grant the telecom's request for a hearing, it would be held June 17.
If the Supreme Court had not agreed to a quick hearing, the decision could have taken as long as eight months, some observers said. That could allow the investor syndicate trying to buy BCE to walk away from the deal without paying a break fee that could reach $1 billion.
That comes as a relief to BCE investors who'd been wondering if the takeover would ever proceed as originally arranged.
BCE shares had plunged more than $4 last week after the Quebec Court of Appeal ruled that Bell bondholders had not been treated fairly in the takeover process. Investors bailed out, fearing that the $51.7-billion takeover might collapse or be re-worked with a lower price.
The takeover deal, which was announced 11 months ago, calls for shareholders to receive $42.75 a share in cash for each BCE share. But with global credit markets in flux following the U.S subprime mortgage meltdown, banks have found it much more difficult to raise the money for leveraged buyouts.
The BCE deal includes $34 billion in new debt financing.
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