Fair To Whom? The Quebec Court Of Appeal’s Decision In The Matter Of The Proposed Arrangement Concerning BCE Inc.
Securities and Mergers & Aquisitions Bulletin
June 2008
On May 21, 2008, the Quebec Court of Appeal ruled in favour of a group of debentureholders of Bell Canada Inc., who had challenged the proposed acquisition of BCE through a plan of arrangement by a consortium led by Ontario Teachers’ Pension Plan Board. In a unanimous five judge decision overturning an earlier decision of the Quebec Superior Court, the court found that the proposed plan of arrangement was not “fair and reasonable” to all securityholders. On June 2, 2008, the Supreme Court of Canada granted BCE leave to appeal the decision. The appeal is scheduled to be heard on June 17, 2008. If the Supreme Court of Canada affirms the Quebec Court of Appeal’s decision, the largest leveraged buy-out transaction in Canadian history will have to be restructured or will be at an end. The decision also has a number of implications for boards and their advisors.
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