TORONTO - The Supreme Court of Canada has reserved its decision on the controversial $52 billion leveraged buyout of BCE Inc. (TSX:BCE) and subsidiary Bell Canada after hearing contradictory testimony on the nature of corporate law.
Chief Justice Beverley McLachlin didn't indicate when the country's highest court would make its ruling. There has been speculation the court could make a decision as soon as Tuesday because of the size of the deal and a looming deadline.
The court was asked by BCE to overturn a unanimous Quebec Court of Appeal ruling that the sale of BCE to the Ontario Teachers' Pension Plan and its minority U.S. partners failed to adequately consider the interests of bondholders.
A central question was: What duty the BCE board of directors have to bondholders, other than ensuring they kept receiving interest payments and the principal upon maturity of the debt.
The stakes are enormous. The proposed takeover of BCE would be the largest deal in Canadian corporate history. But after June 30, the buyers would be entitled to walk away from the deal.
