BCE begins tender offers for 7.35% notes, Bell Canada's 6.15%, 5½% debentures

By Angela McDaniels

Tacoma, Wash., Nov. 10 - BCE Inc. and Bell Canada began tender offers Monday for BCE's $650 million 7.35% series C notes due Oct. 30, 2009 and Bell Canada's 6.15% debentures, series M-2, due June 15, 2009 and 5½% debentures, series M-16, due Aug. 12, 2010.

The tender offers are being made in connection with the privatization of BCE by an investor group led by Teachers' Private Capital, the private investment arm of the Ontario Teachers' Pension Plan, and affiliates of Providence Equity Partners Inc., Madison Dearborn Partners, LLC and Merrill Lynch Global Private Equity.

The companies are offering to purchase the notes for a price equal to the Canada yield price plus accrued interest up to but excluding the closing date of the privatization, which is expected to be Dec. 11.

The Canada price yield will equal the price of the notes calculated at 10 a.m. ET on Dec. 10 to provide a yield from the closing date of the privatization to the notes' maturity date equal to the Government of Canada yield plus 60 basis points, according to a 6-K filing with the Securities and Exchange Commission.

The Government of Canada yield means the yield from the closing date to the maturity date that an issue of non-callable Government of Canada bonds would carry on the remaining term of the notes.

BCE said the calculation of the purchase price is similar to the amount that noteholders would have received had the notes been called.

The tender offers will expire at noon ET on Dec. 10 and are conditional on the consummation of the privatization.

The company plans to call any notes not purchased in the tender offers after the privatization closes.

Computershare Investor Services Inc. (800 564-6253) and CIBC Mellon Trust Co. (800 387-0825) are the depositaries for the notes and debentures, respectively.

BCE is a Montreal-based communications company that provides telephone, internet, television and information services.

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