KKR may be set to get involved in the acquisition of Canada’s biggest telco, in tandem with a trio of Canadian pension funds, reports Bloomberg. If consummated the deal for Bell Canada parent BCE, in which KKR would play a junior role, would be the largest ever Canadian buyout deal. The FT also points out that the deal would represent the biggest co-investment by far between pension funds and private-equity groups.
BCE, the market value of which is C$31bn, announced that it was looking into its options with the Canada Pension Plan Investment Board, the Caisse de Depot et Placement du Quebec, and the Public Sector Pension Investment Board.
As recently as March 29, BCE’s CEO Michael Sabia was adamant that a buyout was not the way to go, reports Bloomberg.
Any transaction would have to ensure “the company remains Canadian, to meet existing foreign ownership restrictions,” BCE said in the statement. Canadian law bars foreigners from owning more than 46.6 percent of a domestic phone company. The discussions with KKR et al are not exclusive and other avenues are being pursued, but no further details were revealed.
The FT said that rival bids are unlikely, given the most feasible, from fellow Canadian Telus, would probably fall down on competition issues.