Teachers group wins C$52 bln race for BCE

By Janet Guttsman

TORONTO (Reuters) - BCE Inc (BCE.TO: Quote, Profile, Research, Stock Buzz), Canada's largest telecommunications group, announced the biggest buyout in Canadian corporate history on Saturday, accepting an offer worth C$51.7 billion ($48.5 billion), including debt, from a group including the Ontario Teachers Pension Plan.

BCE said its board recommended that shareholders accept the C$42.75 a share offer from the consortium, which includes the pension plan's investment arm, Teachers Private Capital, as well as Providence Equity Partners Inc. and Madison Dearborn Partners, LLC.

The buyers will take BCE private, changing the ownership structure of a blue chip corporation described as an investment for widows and orphans because of generous dividend payments.

"This represents very, very substantial value for our shareholders," Chief Executive Michael Sabia told a conference call announcing the deal. He described the price as "compelling" and said it was a good deal for private and institutional investors.

The group including Teachers Private Capital was one of several competing for BCE, which is known for its Bell Canada phone services and for media interests grouped in CTVglobemedia, part owners of the national Globe and Mail newspaper.

Boutique investment bank Catalyst Asset Management, which put in a bid spurned by the BCE board, urged shareholders to vote for its proposal, which it said was worth between C$42.50 and C$52 per BCE share.

LARGEST SINGLE STAKEHOLDER

Teachers was already BCE's largest single shareholder, with a stake of some 6 percent. BCE said Teachers Private Capital would own 52 percent of the company if the deal goes through, meeting Canadian rules that telecommunications firms are majority-owned by Canadian firms.