Sunday, February 24, 2008

A nation of sellouts? I think David Olive needs to speak with his boss and take a look in the mirror

David Olive of the Toronto Star asks the self evident question of the day in today’s paper: “A nation of sellouts?”

David needs to read:

Where is Parliament on the rape and pillage of Canada's largest telecommunications company: BCE?

Since, meanwhile his boss, Rob Prichard , CEO of Torstar is writing to the CRTC (read here) in support of the leveraged buyout of BCE, arguing the sellout in these terms:

I write to extend the support of Torstar Corporation to BCE Inc.’s application for a change in ownership and control......We are also investment partners with Ontario Teachers’ in CTVGlobemedia. I am a member of that Board of Directors, on which Jim Leech, CEO of Teachers’ is also a member. I have seen him demonstrate as a major investor Teachers’ appreciation for the needs of consumers.

I guess that means the 240 basis point increase in the cost of BCE’s capital won’t lead to increased monthly phone bills the way the Industry Committee would have us believe:

“A higher cost of capital slows the rate of capital investment and, in turn, the roll out of competitive services

A cost of capital differential of approximately 1.18% exists between Canada’s incumbent telephone carriers and Canadian cable companies. This incremental cost equates to about $1.46 per month per cable subscriber.”

Meanwhile the same journalist, David Olive of Toronto Star wrote an opinion piece in September 2007 entitled: Income Trusts 2.0, an unwanted sequel:

Doesn’t David Olive understand finance? The LBO of BCE is that very Income Trusts 2.0, an unwanted sequel, except in this case the tax leakage is for real and not just a fraudulent argument being advanced by Mark Carney

Perhaps David should bone up on this article from the Financial Post, before he next puts pen to paper:

Flaherty's tax conundrum: BCE Privatization could cost him $800-million

I think the nation of sell outs are the journalists at the Star, to wit:

Will the Toronto Star ever find its inner Woodward/Bernstein?

Meanwhile, read about the Star’s complete exercise in non-culpable hypocrisy:

A nation of sellouts?
What hope is there for Canada to be anything but a second-tier, resource-dependent player on the global stage if every time a corporation approaches critical mass, it gets sold off to a foreign buyer?
Feb 24, 2008 04:30 Am

1 comment:

Dr Mike said...

The "Nation of Sell-outs" article is a beaut by a guy who obviously has missed the boat when it comes to promoting sell-outs.

David Olive somehow does not see the connection between the federal gov`ts policy on income trusts & their subsequent lower valuation & resultant sell-off.

When the Canadian gov`t aids foreign takeovers as they have done in this case , we are all but screwed with no hope of redemption.

Thanks Canada`s "new" gov`t----maybe now we can drop the "eh" from the end of our sentences--after all, it was only in Canada , pity!!!!!