BCE buyout gets CRTC blessing

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TORONTO -- Canada's broadcast regulator on Thursday gave its final approval to the CAN$34.8 billion ($34.3 billion) buyout of Canadian phone giant BCE by a domestic pension fund and its U.S. equity partners, but attached strings to ease foreign ownership concerns.

"These conditions will ensure that control of BCE remains in Canadian hands once the transaction is completed," said Konrad von Finckenstein, chairman of the Canadian Radio-television and Telecommunications Commission .

The Ontario Teachers' Pension Plan and U.S. partners Providence Equity Partners, Madison Dearborn Partners and Merrill Lynch propose to take BCE private along with its broadcast assets, which include a stake in national TV network CTV and ownership of Bell ExpressVu, the direct-broadcast-satellite TV service.

The CRTC said that the number of directors on a privatized BCE board must be fixed at 13, and that the directors that represent Canadian investors must always out-number those that represent non-Canadian investors.

The regulator also said that the board chairman must be Canadian and cannot be the CEO or a director nominated by a non-Canadian investor.

The CRTC attached other corporate governance conditions before it blessed the BCE deal, which represents Canada's largest-ever leveraged buyout.

All that awaits final approval of the BCE deal is permission from Industry Canada, an arm's-length government agency that will consider the privatization on competition grounds.
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