The Successful Investor Hotline – Friday, July 25, 2014

Article Excerpt

BCE INC., $49.32, Toronto symbol BCE, has agreed to buy the 56% of BELL ALIANT INC., $30.93, Toronto symbol BA, that it doesn’t already own. Bell Aliant sells phone and Internet services to 2.3 million customers in Atlantic Canada and rural Ontario and Quebec. It also provides wireless services through an alliance with BCE. Bell Aliant shareholders will have three options when they tender their shares: $31.00 in cash; 0.6371 of a BCE common share; or $7.75 in cash plus 0.4778 of a BCE share. Investors can defer capital gains taxes on the BCE shares they receive until they sell. In all, BCE will pay $3.95 billion in cash and stock, which is equal to 10.3% of its $38.4-billion market cap. The company will cap the cash portion at 25% of the total purchase price. BCE expects to close the deal by November 30, 2014. Following the takeover, Bell Aliant’s shareholders will own 7% of the combined company. Merging the two firms will make it…

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