The latest deal to come under pressure from the credit crunch is the acquisition of the giant Canadian telecom company Bell Canada by a consortium led by the Ontario Teachers' Pension Plan. The deal that was billed as "the biggest leveraged buyout of all time" now faces pressure from the banks that have committed financing to the deal, according to reports. One executive involved in the negotiations has told The New York Times that the Bell Canada is "Clear Channel, the sequel," referring to the leveraged buyout that was almost scuttled when banks threatened to walk away from financing commitments until the sellers agreed to a lower price.
The group led by the Ontario Teachers' Pension Plan beat out private equity firms Kohlberg Kravis Roberts and Cerberus Capital in the auction for Bell Canada back when the going private mania was in full swing. That winning group includes Toronto-Dominion Bank, Providence Equity Partners, Madison Dearborn Partners and Merrill Lynch Global Private Equity.
Citigroup, Deutsche Bank and Royal Bank of Scotland all committed financing to the deal. But last week they began to balk, demanding tough debt covenants and higher interest rates. Sources say the terms look like they were designed to force a renegotiation of the deal.
Bell Canada and the Ontario Teachers' Pension Fund are holding firm for now, saying that they intend to hold the banks to their original lending terms.Shares of Bell Canada have dropped on the bet that, at best, shareholders will be forced to take a lower price. The deal was expected to close in June.
Shares of Bell Canada Drop as a Buyout Deal Unravels [New York Times]
Posted by guest , May 20, 2008 10:58AM
Us '76 bondholders have rights, EH?
Posted by guest , May 20, 2008 11:28AM
Maybe the Canadian bankers can be wooed back to the table with a few two-fours of Labbat's '50' and some lap dances from Montreal strippers with messed up grills?
Eh?
Posted by guest , May 20, 2008 11:38AM
You forgot the Craven A or Shredder Number 7 cigarettes. A case of Extra Old Stock would be good too.
--Calgary Schmooze
Posted by guest , May 20, 2008 11:40AM
ahhhhh, the curse of the fortune cover story...
Posted by guest , May 20, 2008 12:41PM
Calgary Schmooze, I thought that Player's Light was the smoke of choice amongst hosers, eh?
Posted by guest , May 20, 2008 1:50PM
Player's brand is very popular, as is duMaurier.
But if you're going to ask for a case of "high test", you also toss in a carton of lung shredders with extra fiberglass.
Random trivia - in the late 80s and early 90s, one street address (a DKE fraternity chapter) was the single largest consumer of Old Stock in Canada.
http://www.beerpal.com/Okeefe-Extra-Old-Stock-Ale-Beer/18065/
--CS
Posted by guest , May 20, 2008 3:23PM
Calgary Schmooze, would that be the Delta Phi chapter of DKE? My old chapter had (or still has, I don't know) a vintage Coke bottle machine in the basement that served up bottles of Old Stock.
I know that we got a Christmas card every year from the brewery rep.
Some of the best memories I barely have from that era involve Old Stock and Pi Beta Phi girls.
Posted by guest , May 20, 2008 3:33PM
CS - you work for #3, #10 or #77?
Posted by guest , May 20, 2008 3:33PM
CS - you work for #3, #10 or #77?
Posted by guest , May 21, 2008 2:04AM
@3:23,
Yes, that would be Delta Phi.
Pi Phis or Thetas or DeeGees... after a few pops, did it matter? ;-)
@3:33,
I'll zip my lips now. Less is more.
--CS
Posted by guest , May 21, 2008 9:52AM
rat bastard!
-- @ 3:33