The Successful Investor Hotline – Friday, December 12, 2008

Article Excerpt

BCE INC. $21.23, Toronto symbol BCE, has confirmed that its $42.75-a-share takeover by a private consortium led by the Ontario Teachers’ Pension Plan will not proceed. The deal required auditing firm KPMG to provide an opinion on BCE’s solvency following the takeover. KPMG concluded that BCE would fail this test. BCE disagreed with KPMG’s assessment, and hired a second auditing firm, PricewaterhouseCoopers, to help it address specific items in KPMG’s report. However, KPMG did not change its opinion, and the deal died. BCE still wants the buyers to pay it the previously agreed upon $1.2 billion termination fee. That’s equal to roughly 7% of its market cap. The two sides will probably negotiate a lower fee instead of taking the matter to court. The company has now resumed quarterly dividends of $0.365 a share. That gives it a current yield of 6.9%. BCE will also buy back 5% of its outstanding shares. BCE is a buy. PRECISION DRILLING TRUST $8.20, Toronto symbol PD.UN, still aims…