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With the $52 billion deal to buy BCE all but scuttled, investors and analysts have once again turned their attention to the idea of marrying the phone company with rival Telus Corp.
More than a year after Telus abruptly dropped out of the race to buy BCE, one Bay Street analyst claims the Burnaby, B.C.-based phone company is still carrying a torch for the Bell Canada parent.
“We believe Telus remains very interested in entering merger discussions,” said John Henderson, an analyst at Scotia Capital, in a note to clients yesterday.
A Telus spokesperson declined to comment.
The speculation follows BCE’s disclosure Wednesday that accounting firm KPMG is unlikely to sign off on the $52-billion privatization deal that had been proposed by the Ontario Teachers’ Pension Plan and U.S. private equity firms. In its preliminary view, KPMG said the privatized company would not meet the deal’s solvency test under current market conditions.
Shares of BCE plummeted nearly 35 per cent as analysts suggested there was little hope of the deal being resurrected.
That left investors looking for a “Plan B.”
Control
• A Bell-Telus union would result in a company that controls nearly all of Canada’s local phone service and about 60 per cent of the wireless market.
• Many believe a merger would be too bitter a pill for Ottawa to swallow in the wake of the auction of wireless airwaves.
More than a year after Telus abruptly dropped out of the race to buy BCE, one Bay Street analyst claims the Burnaby, B.C.-based phone company is still carrying a torch for the Bell Canada parent.
“We believe Telus remains very interested in entering merger discussions,” said John Henderson, an analyst at Scotia Capital, in a note to clients yesterday.
A Telus spokesperson declined to comment.
The speculation follows BCE’s disclosure Wednesday that accounting firm KPMG is unlikely to sign off on the $52-billion privatization deal that had been proposed by the Ontario Teachers’ Pension Plan and U.S. private equity firms. In its preliminary view, KPMG said the privatized company would not meet the deal’s solvency test under current market conditions.
Shares of BCE plummeted nearly 35 per cent as analysts suggested there was little hope of the deal being resurrected.
That left investors looking for a “Plan B.”
Control
• A Bell-Telus union would result in a company that controls nearly all of Canada’s local phone service and about 60 per cent of the wireless market.
• Many believe a merger would be too bitter a pill for Ottawa to swallow in the wake of the auction of wireless airwaves.
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