CORRECTED-UPDATE 2-Canada's BCE to take Bell Aliant private in $3.7 bln deal
(Corrects second paragraph show BCE is based in Montreal, not Toronto)
By Euan Rocha and Alastair Sharp
TORONTO, July 23 (Reuters) - Canada's largest telecom company, BCE Inc , said on Wednesday it will pay C$3.95 billion ($3.68 billion) to take regional telecom Bell Aliant private, buying the 56 percent stake it does not already own to cut expenses and bolster its offerings in Atlantic Canada.
Montreal-based BCE said the deal will result in C$100 million in annual cost savings, partly due to the elimination of duplicate public company costs.
"Privatizing Bell Aliant within BCE supports our dividend growth model and capital investment strategies," Siim Vanaselja, BCE's chief financial officer, said in a statement, adding that BCE will also maintain its investment-grade credit ratings following the expected close of the deal in late November.
BCE, which already controls about 44 percent of Bell Aliant, said the deal values the remainder at C$31 a share, a premium of 10 percent to the stock's close on Tuesday.
Shareholders of Bell Aliant, which also offers services in rural Ontario and Quebec, can elect to receive either C$31 in cash, or 0.6371 of one BCE share, or C$7.75 in cash and 0.4778 of one BCE share for every share they own, the companies said in a joint statement.
Shares in BCE were up 0.8 percent at C$49.39 at midmorning on Wednesday on the Toronto Stock Exchange, while Bell Aliant shares jumped more than 10 percent to sit just above BCE's offer price at C$31.17.
BCE competes with Rogers Communications Inc and Quebecor Inc in Eastern Canada for phone, Internet and TV customers, while sharing a national wireless network with Western Canada-focused Telus Corp. Continued...