Terry Corcoran: Latter day investor crusader

Is it just me, or did I miss the Terry Corcoran piece entitled "Unit owners unite"?

I’ve finally figured Terry Corcoran of the Financial Post out. Like any bad scientist he starts with the outcome that he is seeking and then he flails around indiscriminately looking for isolated facts and grand principles that when inconsistently applied along with a good dose of fear mongering will partially justify (in his mind at least) the preordained outcome in desperate need of justification and a band leader.

Take today’s exercise in post rationalization and fear mongering. You’d almost get the impression that Terry wrote this piece for the Canadian Council of Chief Executives. No doubt he in fact did. Today’s sermon is entitled “Share owners unite!”

Does this mean that Terry is going to form CAITI2? No chance of that ever happening since that would require inordinate time, effort and dedication on Terry’s part. Plus he wouldn't get paid. Funny that the person calling for “Share owners to unite” was the very person who called for the head of CAITI to be “vaporized”.

I guess that means that Shareholder can unite, but that Unitholders can not. Where’s the logic in that? Where is the consistency in that? Stop looking, as there isn’t any, apart from the fact that Terry Corcoran (a la the CCCE) wants the corporate model and all its attendant abuses to continue and the trust model to die based on some factless fear mongering argument of his concoction, best summarized by his elegant line of reasoning for ignoring the taxes Ottawa collects on income trusts:

"And when will you guys stop the bullshit about “tax exempt” status. PENSION FUNDS ARE TAX EXCEMPT. THEY DON’T PAY TAXES. STOP. END OF STORY. hey pass the money through to pensioners. Pensioners pay the tax. RRSPS ARE TAX EXCEMPT. THEY PAY NO TAX. ONLY WHEN THEY MONEY IS PAID OUT IS TAX PAID BY THE TAXABLE TAXPAYER."

Evidently that’s Terry’s rationale for why the federal government is free to assign zero value to taxes paid on RRSP withdrawals even though such taxes amount to $16 billion per annum, and taxes paid on RRSP withdrawals exceed taxes deferred on RRSP contributions. Don;t want the true facts to get in the way of the ordained outcome.

As such Terry is the last person to call for shareholders to unite. Meanwhile the BCE situation is the last deal scenario that shareholders should want to rally around, based on the unproven premise that shareholder value is maximized for BCE by the Teachers deal. It may all prove a moot point since the deal’s financing is very much an open question. How does Terry Corcoran know that BCE maximized shareholder value? There is insufficient disclosure in the bid circular to reach any such conclusion. There are far too many questions unanswered:

What did Cerberus actually bid? What was its cash value?
What did the Catalyst Proposal consist of? What risks did it avoid? What was its value?
Why did BCE discourage and frustrate Telus’ ability to bid?
Why is BCE’s dividend now being withheld?
Does maximizing value mean on a pre tax or an after tax basis? Teachers’ bid is all taxable. Was the Cerberus bid fully taxable? Catalyst? Would Telus have been fully taxable?

One thing is for sure, Terry Corcoran is neither qualified nor sufficiently motivated to ever be the rallying point for shareholders to unite. As for this BCE deal, there’s just too many open questions and conflicts of interest. Far too little disclosure. Zero oversight by the regulators who do not uphold standards of disclosure in takeover bid circulars. Why? That’s a cause that a true investor advocate would be pursuing. Not one off deals like BCE. Perhaps someone should buy Terry a subscription for the Financial Post. I’d be curious to know how he would weave these stories into his rallying call on behalf of BCE (err sorry, BCE shareholders):

Financial Post June 9 2008
BCE's Revlon glitch?
by Barry Critchley

Financial Post May 23 2008
Elegant solution given short shrift
by Barry Critchley

Financial Post May 22 2008
BCE: smackdown finally
by Diane Francis

Global Pensions April 25 2008
OTPP accused of flouting rules – faces legal action
by Heather Dale

Financial Post February 2, 2008
Roadblocks to Shabby Bell Affair
by Diane Francis

Financial Post January 30, 2008
Catalyst's Bell Bid Silenced
by Barry Critchley

Canadian Press January 28, 2007
Bondholders say BCE finessed takeover deal to avoid bond redemption

Financial Post July 1, 2007
BCE Inc. sale has company insiders poised to reap millions
Sean Silcoff

National Post June 22, 2007
Everybody wins with Catalyst plan
Diane Francis