Monday, April 13, 2009

Jim Leech: “Read my lips, BCE will close.”

“Read my lips, BCE will close.” was the title of this Globe article dated January 23, 2008.

Rather than conjuring up images of Clint Eastwood, this shallow statement of Jim Leech’s only served to conjure up images of George H. W. Bush. Like we ever thought that Teachers’ was in the driver’s seat over whether this BCE deal would close, or that Herbert Walker would make good on his promise of "no new taxes".

How could they be? Teachers’ was only ever putting up 7% of the money. Even less after BCE shareholders were told they weren’t getting $1 billion in dividends that they were contractually promised in the Bid Circular that they'd be getting.

However there must be people out there who think this deal actually did close. Take Derek DeCloet of the Globe itself for example, who wrote an an article on the weekend that held itself out as being a compendium of all the screw ups of the last year caused by the global financial meltdown.........except Derek conveniently neglected to mention the monumental screw up called BCE’s junk bond LBO fiasco with Teachers’?

Would this have anything to with the fact that two of the Globe’s four owners are BCE and Teachers’? The other two being Torstar and Woodbridge.

Derek does comment on Torstar’s Rob Prichard receiving a $10 million consolation prize upon being fired, but that must be fair game, since he was let go from Torstar itself, so Derek is only applauding their bigger actions. Meanwhile Derek is mute on the even larger $21 million consolation prize that Michael Sabia received upon being let go from Teachers’ no less. Would this have anything to do with Sabia’s shakey position on becoming the Caisse’ next unqualified CEO. A position that Sabia found in the bottom of a Cracker-Jack box? You know, the process by which you got your last job?

The Globe’s motto must be “All the news fit to ignore”. Either that or Derek DeCloet wasn’t around to witness the monumental screw up involving Teacher’s failed LBO of BCE in the past few months. Could this amnesia on the part of Derek Have anything to de with the fact that this biased news organization has allowed its editorial content be influenced by “other considerations”. After all, how credible is it for Derk DeCloet to written an article on the weekend that is held out to be a compendium of all the financial screw ups of the recent financial meltdown of the last year and not mention Teachers’ fiasco involving BCE?

Derek has outdone himself in reporting on the parallel universe that is covered by the Globe. A parallel universe which sees to it that the Globe completely blows its coverage of the income trust story and repeatedly fails to report on the FACT that Jim Flaherty’s and Mark Carney’s tax leakage argument is a blatant manufactured hoax. Or the parallel universe that sees Jackie McNish completely misinforming the Globe’s readers about what arguments I (as Catalyst) was going to be making before the Supreme Court of Canada, as I intervened against the LBO of BCE before the SCC, a transaction involving two of her precious owners. The fact that she was in possession of Catalyst’s SCC factum, makes this misreporting of hers completely unacceptable and totally suspicious as to its desired intent to diminish and defame.

During the tortured tale of BCE’s takeover by Teachers’ over the last 18 months, readers of the Globe were constantly greeted with an incessant cheery refrain which described this deal as “The world’s largest leveraged buyout”., and whose constant annoying and mindless refrain prompted me to blog an article entitled “What, that’s a good thing?”. And yet when, the “The world’s largest leveraged buyout” blows up, it doesn’t even deserves inclusion in Derek’s compendium of screw ups in Canada caused by the global meltdown.......but measly Canwest does, when it comes to its screw up over the mini-LBO of Alliance Atlantis?

I don’t get it? Well actually I do. Business reporting in the Globe and its sister organization, BNN (Biased News Network) is, well how do I say this, biased. It’s biased and bad news coverage like that contained in the Globe or broadcast on BNN that contributes immensely to global meltdowns like we are now experiencing. Jon Stewart drove that point home just recently.

The Globe even confessed that they understood and had heeded Jon Stewart’s important message......for the better part of one day, by the looks of Derek’s article and all subesequent news repoing in the Globe following their mea culpa (or was that just Lawrence Martin acting as a rogue journalist confessing to the sins of a news organization he only works for as opposed to speaks for?).

Bernie Madoff could not have found a better partner with which to have perpetrated his $50 billion fraud that the Globe and Mail, than if his name had been Jim Flaherty trying to perpetrate his $35 billion income trust fraud.

All that Flaherty’s fraud took to be successful was getting Canadians to “buy in” to the manufactured falsehood that income trusts cause tax leakage, and for the Globe to turn its head away from reporting on the litany of negative fallouts of this policy, like the LBO of BCE....that Derek is dutifully ignoring as part of the Globe’s mandate of “All the news that’s fit to ignore and counter to our onwers’ interests to report.”

Had Derek honestly and completely reported on the screw ups caused and exposed by the global market meltdown and had he considered how those events played into the blowup of “The worlds largest leveraged buyout” he could have made these observations, in the manner of his article:

Jim Leech of Teachers’
: “Read my lips, this deal will close”.....even if it means changing the price of the deal by $1.00 without shareholder approval, thereby ripping off widows and orphans for $1 billion of accrued and unpaid dividends, destroying billions in the value of BCE bondholders investment value and requiring that BCE summarily fire 2,500 BCE workers, even before we’ve paid for the my lips, this deal will collapse, along with Teacher’s and my reputation.

Richard Currie of BCE:
“Most of you people think that the slogan I created when I was at Loblaws of “President’s Choice” and “Insiders Report” were merely slogans. In reality, these speak to my core values. The concept of President’s Choice was what gave me the supreme power to select the Teacher’s deal over other offers the company had been presented, because I personally like it.

Much like George Bush, I fashion myself as the Decider, which is why I treat BCE shareholders with such disdain at shareholder meetings, as in “Christ, when will this ever end?”. As the President's Choice Decider and my love of all things “Insider”, I felt free not to disclose in the Bid Circular to BCE shareholders the existence of the Catalyst Proposal ( that would have been superior in every respect and for all stakeholders (except one) and which would have actually closed and been completed, since it required no financing, as it was a share recapitalization.

The one aspect of the Catalyst deal that made it a non starter under my President’s Choice model of corporate governance, was the fact that it did not accelerate BCE Management’s employee stock options and shower them with ill-deserved riches. This is what is meant by President’s Choice....we were doing what Michael Sabia wanted to do and what was in his best interests so that he could exercising his options, as in stock options....and not the shareholders’ who were kept in the dark about exercising their in, seeing the bid from Catalyst and what it would have meant to them.

Michael Sabia of BCE:
“The are four words that describe why I am so pleased with the deal we announced yesterday with Teachers’.... Forty.... two.... seventy.... five”. I am so pleased with this notion of getting $42.75 for BCE’s shareholders (and ourselves as employee stock option holders), that I am prepared to go to the Supreme Court of Canada to gain the permission too oppress BCE’s bondholders to the tune of a couple of billion of their investments in BCE.

I am also prepared to unilaterally and without shareholder approval change the price of the deal by canceling BCE’s dividend, despite explicit assurances in the Bid Circular that we would not, in the knowledge that only BCE shareholders would suffer this $1.00 per share loss, but as a significant Employee Stock Option holder, I would not. Even though I was successful in getting the Supreme Court ruling that allowed me to oppress bondholders, by the Court’s conveniently ignoring the legal significance in contract law concerning the repeated verbal assurances I gave to BCE’s bondholders that investment grade credit was fundamental to BCE’s DNA, I was still concerned about lawsuits that would be triggered if the company’s precarious mountain of junk bond debt were to default.

Rather than giving the bondholders some form of compensation, as they were asking for, that would have amounted to no more than a $1.00 per share, I decided to play tough and cover my ass by inserting an “insolvency clause” in the purchase and sale agreement. When the deal blew up over this very clause that I had inserted to cover my ass, I had a tough time finding someone else to blame, since I had already fired so many people at BCE to cover up for my other mistakes,, like the time I sold Yellow Pages for 50 cents on the dollar, or the hatchet job I did while “cleaning up” Bell Canada International”.

Did you hear that I am trying to install myself as the head of the Caisse? That sure has caused a storm of negative press.....everywhere, except from my BFF’s at the Globe.

1 comment:

Kephalos said...

The failed BCE takeover smells of insider self-dealing, conflict of interest and influence peddling.

I say these things based on publicly available appearances. The appearances smell awful.

The Department of Finance was deeply involved in manoeuvering the take-over. It appears that the Minister was influenced.

OTPP was on both sides of public/private BCE. Looks a lot like a conflict, eh?

As for Sabia going to Caisse, what a good job to have if your job is look like you're blocking questions about Caisse's actual and opportunity losses at BCE?