Catalyst Asset Management Inc. comments on BCE Sale at announced price of $42.75

    TORONTO, June 30 /CNW/ - Bell Canada announced this morning that it has
reached a definitive agreement to sell Bell Canada to a consortium of US and
Canadian private equity firms for $42.75 per Bell Canada common share. This
going private sale requires two thirds shareholder approval and CRTC approval.
    The Catalyst Proposal at involves the exchange of
Bell Canada Common shares on a one for one basis for Stapled Securities that
will pay combined annual dividends and interest of $2.55 per existing Bell
Canada common share. Catalyst values the Stapled Securities at between $42.50
and $52.00. Relative to Catalyst Proposal, the announced sale price of $42.75
represents a foregone loss of value to Bell Canada shareholders who accept the
offer of up to $8 billion, based on the high end of the Catalyst value range.
In addition, the announced transaction is a cash offer that will trigger
capital gains on the part of Bell Canada common shareholders who are taxable,
whereas the Catalyst Proposal provides shareholders with a tax free rollover
of at least two thirds of the consideration received. Catalyst Asset
Management Inc. recommends that Bell Canada shareholders vote against the
proposed going private sale of Bell Canada to private equity in favour of
implementing the Catalyst Proposal. The Catalyst Proposal will preserve Bell
Canada as Canada's most widely held public company and in so doing will
maximize Ottawa's tax collection base by preserving Bell Canada's large base
of taxable investors unlike the sale to private equity whose principals are
non taxable pension funds and/or taxpayers in foreign tax jurisdictions.

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Catalyst Asset Management Inc.

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