BCE

Case Solution for BCE Inc.: Bondholders Versus Shareholders Supreme Court Showdown?

Complete Case details are given below :
Case Name :      BCE Inc.: Bondholders Versus Shareholders Supreme Court Showdown?
Authors :           Stephen R. Foerster, David Kunsch
Source :             Ivey Publishing
Case ID :            909N27
Discipline :        General Management
Case Length :    05 pages
Solution Sample availability : YES
Plagiarism : NO (100% Original work)
Description for case is given below :
In May 2008, the board of directors of BCE. Inc. (BCE), one of Canada’s leading integrated communications companies, was dealing with the fallout of a previous day’s Quebec Court of Appeal decision. The court had ruled to disallow a $50 billion privatization deal as, according to the court, the process was flawed and did not take into consideration the debenture (bond) holders of Bell Canada (a wholly-owned subsidiary of BCE). The court had ruled that the board allowed a deal in which benefits had accrued only to the shareholders (a 40 per cent increase in value since the firm was in play) at the expense of the bondholders, who were dealt an 18 per cent decrease in value over the same time period. In deciding whether or not to launch a last-ditch appeal to the Supreme Court of Canada, management and the board needed to determine who were the key stakeholders involved in the decision to take the firm private, what their interests were, and how those interests should guide the board.
 
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Case Solution for BCE Inc.: In Play

Complete Case details are given below :
Case Name :      BCE Inc.: In Play
Authors :           Stephen R. Foerster, Heather Tobin
Source :             Ivey Publishing
Case ID :            909N18
Discipline :        General Management
Case Length :    16 pages
Solution Sample availability : YES
Plagiarism : NO (100% Original work)
Description for case is given below :
BCE Inc. (BCE), one of Canada’s leading telecommunications companies, had struggled under its weak stock price performance and low valuation relative to its comparable peers, and faced increasing pressure from its largest shareholder, the powerful Ontario Teachers’ Pension Plan (Teachers’). On March 29, 2007, it was reported that private equity firm Kohlberg Kravis & Roberts (KKR) had held informal meetings with BCE executives in the hopes of launching a friendly takeover bid for the company. This essentially put BCE “in play” with the leadership team confirming, on April 17, 2007, that it would be reviewing its strategic alternatives, which included discussions with various Canadian-led consortiums to explore the possibility of a privatization. As the deadline to the bid date drew closer, four contending bidding consortiums emerged, including three consortiums of financial buyers and one strategic buyer. The case provides a good opportunity to discuss private equity investments as well as valuation in a mergers and acquisition context.
 
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Case Solution for Leveraged Buyout (LBO) of BCE.: Hedging Security Risk

Complete Case details are given below :
Case Name :      Leveraged Buyout (LBO) of BCE.: Hedging Security Risk
Authors :           Colette Southam, Ahsen Amir-Ali, Samir Meghji
Source :             Ivey Publishing
Case ID :            908N23
Discipline :        Finance
Case Length :    07 pages
Solution Sample availability : YES
Plagiarism : NO (100% Original work)
Description for case is given below :
In 2007, an analyst in the derivatives group of investment bank Grenfeld & Co. was asked to devise a hedging strategy for Providence Equity Partners (Providence) in Bell Canada Enterprises (BCE Inc.). Providence was based in the United States and any strategy would involve significant foreign exchange rate risk due to the conversion of returns into U.S. dollars. The analyst needed to consider several long-term hedging strategies that Grenfeld & Co. could recommend to Providence. Her vice-president had asked that she create a hedging strategy by initially assuming a 25 per cent IRR for the investment and its performance, based on two outcomes at the end of the investment (investment horizon = five years): a zero per cent IRR and a 25 per cent IRR.
 
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