hr: Money

BCE Inc.’s plan to go private in the world’s largest buyout got back on track yesterday after the Supreme Court of Canada approved the deal, sending the stock up as much as 8.2 percent in late trading.

Canada’s highest court unanimously overturned an appeals- court decision blocking the C$52 billion ($51.3 billion) deal. The lower court had ruled that the transaction ignored the interests of BCE’s bondholders. The Supreme Court said yesterday it would provide reasons for its decision, without saying when.

The stock has since slumped on concern that bondholders would block the deal or that financing would collapse.

Shares Climb

“We’re back to where we were before the appeal decision came down,” said Greg MacDonald, an analyst at National Bank Financial in Toronto during a Bloomberg interview. The buyout group plans to raise C$34 billion in debt from Toronto-Dominion Bank, Citigroup Inc., Deutsche Bank AG and Royal Bank of Scotland Group Plc to pay for BCE.

The final price of the deal may be 10 percent lower than the current offer price, Veritas’s Monga said.

In May, the bondholders — including Manulife Financial Corp., Canada’s biggest insurer — appealed a trial judge’s decision to approve the transaction, claiming the additional debt would cut the value of their holdings because the bonds would lose their investment-grade rating.

Falling Value

BCE had its biggest drop in 25 years on May 22, after the Quebec Court of Appeal blocked the buyout transaction.

The offer by the buyout group includes C$16.9 billion in debt, preferred shares and minority interests. Before the appeals-court ruling, the deal was slated to close this quarter.

The case is Between BCE Inc. and a group of 1976 Debentureholders, 32647, Supreme Court of Canada (Ottawa).