Stockwatch – BCE Makes Move to Buy Glentel

Stockwatch – During the second quarter of 2014 BCE’s revenue grew by 4.4%, to $5.2 billion.

Stockwatch – BCE Inc. (TSE:BCE, Mkt cap 43.94B, P/E 17.61, Div/yield 0.62/4.72, EPS 2.97, Shares 839.60M) has signed an agreement to buy wireless phone retailer Glentel Inc. in a deal valued at $670 million in stock, cash and debt, which analysts say further extends the telecoms giant’s reach into the wireless market.

The wireless segment has played a pivotal role in BCE’s growth in recent years, and the acquisition of Glentel is key to its strategy to accelerate the technology further.

Stockwatch BCE Glentel Wirelesswave T-Booth

Stockwatch – BCE to buy Glentel. The retailer owns the Wirelesswave and T-Booth brands.

Burnaby, B.C.-based Glentel has nearly 500 retail locations across Canada, offering customers wireless products and services from a variety of carriers including Bell Mobility, Rogers Wireless, Chatr, Fido, SaskTel and Virgin Mobile.

The company has a considerable presence outside of Canada, too, with 735 stores in the United States and a further 147 in Australia and the Philippines.

BCE highlighted that it has spent almost $7 billion in under a decade to acquire new wireless spectrum and build the high-speed wireless networks to utilize those airwaves.

As part of the deal, BCE will take on net debt and minority interest of approximately $78 million. The cash and stock transaction is expected to close by the end of the first quarter of next year.

Glentel CEO Tom Skidmore said he is delighted that Glentel, together with Bell, will continue to deliver “legendary” customer service, adding that the new relationship will not only provide additional value to its shareholders, but its employees, too.

The Skidmore family, which has a stake of approximately 37% in Glentel, has signed agreements with Bell supporting the sale.

Glentel shareholders can choose to receive either $26.50 in cash or 0.4974 of a BCE share for each Glentel share they hold.

Stockwatch – During the second quarter of 2014 BCE’s revenue grew by 4.4%, to $5.2 billion from $5.0 billion, as a result of strong demand for the company’s wireless and Fibe TV services. BCE faces a number of regulatory challenges, however it is doing a good job of improving its services and keeping its operating costs down. That will likely allow the company to maintain its high dividend yield.

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