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BCE Inc. Message Board

  • coffeewagon coffeewagon Apr 19, 2007 11:15 PM Flag

    Bidding War starting in BCE

    Looks like a Bidding war is brewing for BCE. Hope the stock goes through the roof like Guidant did when JNJ and BSX got into it. Made a ton of $$$ on that one. This one looks to out do the Guidant buy out.

    Private equity can pay more due to all the cash that is flowing into these private companies like KKR and black rock, not to mention these pension funds are exploding with cash to invest. Just look at the SLM buyout. Financial analysts projected a $45 - $48 buyout of SLM and blackrock came in at $60.

    I saw an estimate for BCE of $40 to $42 this would be good but these deals have been getting 20% higher then the analysts prediction. Lets hope for $50

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    • One day at a time. Anything over $40 and we will all be pleased.

    • IMO, look for KKR lead bid this weekend at $45 CAD.

      • 3 Replies to rockman_4
      • Now it is two bids. It looks another bid will surface. It can be over $45.00 This week will tell. It will be interesting. I am still thinking the mid forty. It come with $48, I would be happy.

      • Stock market chess
        Securities Exchange Canada alert to pension plans. Know something stinks when KKR has issues with buying a fraction of BCE shares from BCE shareholders; but will buy half with any Canadian Pension Plan.

        Variation, same deal almost, but different tax structure. KKR doubling its investment, but not, as BCE lends KKR the extra half. Internal/external debt arrangement complexities. BCE can double the amount of BCE stock, and sell the new half to KKR, making BCE debt free. Basically, KKR owes BCE 20 billion, and assumes BCE's long-term debt, and for this receives half of BCE's shares. KKR would in one type of reality would, owe half this 20 billion debt to itself, as KKR owns half of a debt-free BCE.

        Doubling BCE's shares, double dividends paid out. KKR dividend cost stream, uses up BCE's interest savings stream. Note, KKR's debt payments to BCE could increase actual dividend amount per share. Important that, KKR's debt to BCE, and KKR's shares of BCE are protected together as collateral, in appropriate ratio. KKR BCE book value better, then KKR Teachers private BCE -- a private Teachers BCE has new mountain of negative tangible book, and is too debt ridden to add value to the Canadian economy --but a stronger public debt-free BCE KKR does. Note, Revenue Canada makes more in the good book value variation.]

        Ironically, the deals in one sense equal -- in that KKR pension deal, KKR is buying half of BCE's debt anyways, increases KKR's actual deal size -- while KKR buying half of BCE's shares, has KKR owing half to KKR, decreases the actual size of KKR's cost in BCE shareholder deal. A real debate that KKR's versions debt levels equal; KKR borrowing 20 billion and assuming 10 billion in BCE debt; equals KKR assuming BCE's long term debt, and BCE's IOU's 20 billion IOU/half. The accountant paint brush.

      • J've read somewhere that the $45 value is enterprise value, not market cap. Is that the case?

45.80+0.19(+0.42%)Jul 28 4:00 PMEDT

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