WINNIPEG, MB, FEBRUARY 15, 2017 – (TSX: MBT) Manitoba Telecom Services Inc. (MTS) today announced that the
Competition Bureau and Innovation, Science and Economic Development Canada (ISED) have approved the acquisition of MTS by
BCE Inc. (BCE) pursuant to the previously announced plan of arrangement (the Arrangement). Closing of the Arrangement has been
set for March 17, 2017.
The close of the Bell MTS transaction concludes a period of tremendous change at MTS. Over the past several years, MTS undertook
a significant transformation effort affecting all aspects of the company.
“The close of this transaction will represent a watershed moment in Manitoba’s business history, delivering over $1 billion of value to
shareholders while securing investment and community commitments which are so important to the future of the province,” said
David Leith, Chair of the Board of Directors for MTS. “On behalf of the Board I want to recognize the tremendous job Jay Forbes has
done at MTS since joining in January 2015. Together with the entire management team, MTS became stronger and more focused to
deliver maximum value to customers and to shareholders. The value created through the Bell MTS combination is in no small part
due to these significant achievements.”
“This announcement represents the culmination of a successful approach to the regulatory approval process and we look forward to
closing the transaction within the timelines we provided at the outset,” said Jay Forbes, President & CEO. “Our employees should be
proud of all that we have accomplished as a standalone
company, and can look forward with excitement to a bright future as Bell
MTS. I want to thank my colleagues at MTS for the dedication and commitment they have shown. They bring tremendous talent and
energy to work every day on behalf of our customers. Now, with the creation of Bell MTS, they will have the benefit of scale and
significant investment to bring customers the worldclass
telecommunications services the province of Manitoba needs for the
future.”
CLOSING AND ELECTION DATE
The MTS Board, after careful consideration and consultation with its legal and financial advisors, has agreed with BCE to set March
17, 2017, as the closing date for the Arrangement. As a result, the Election Deadline will be March 14, 2017.
A detailed description of the Arrangement is set forth in the MTS management information circular dated May 26, 2016 (the
Circular). Shareholders can obtain a copy of the Circular as filed with the Canadian provincial securities regulatory authorities
at www.SEDAR.com.
The letter of transmittal and election form that was previously mailed to registered MTS shareholders, and is also available on our
website at www.mts.ca/investors and on www.SEDAR.com, explains how registered shareholders can deposit their MTS common
shares, elect the form of consideration they wish to receive and obtain payment for their MTS common shares once the Arrangement is
completed. The letter of transmittal and election form also includes disclosure on the U.S. federal income tax considerations with
respect to the Arrangement for U.S. tax payers, which was not determinable at the time the Circular was mailed. MTS shareholders in
the United States are urged to read this disclosure.
March 17, 2017 has been adjusted from the default closing timeline contemplated by the Arrangement Agreement. The terms of the
Arrangement Agreement anticipated that the parties could select an alternative closing date, and the parties determined to do so in
this instance. Proper closing will require completion of a series of necessary legal steps, including a series of reorganizations.
Given these requirements the Board, upon receipt of legal advice, determined that March 17, 2017 represented the earliest practical closing
date available. In making this decision, the Board recognized that this closing date would, among other things, allow for completion
of all required regulatory matters and the necessary time to allow all contemplated preclosing
steps for this complex transaction to be completed in accordance with applicable laws within the shortest reasonable period of time. Shareholders will also have additional
time to make the election of consideration contemplated by the Arrangement.
MTS and BCE have given effect to the March 17, 2017 closing date by entering into an agreement, a copy of which will be filed with
the Canadian securities regulators and will be available at www.SEDAR.com. Under this agreement MTS and BCE have also each
agreed, among other things, to deliver the necessary certifications with respect to their respective representations, warranties and
covenants to the standards required under the Arrangement Agreement as of February 28, 2017, and to reconfirm the same, subject to
certain modifications, on the closing date.
MTS has also agreed to certain additional covenants relating to the assets to be divested by BCE. In addition, BCE has agreed to waive its right to terminate the Arrangement Agreement in the event of an uncured material
adverse effect of MTS arising after February 28, 2017. The amount of the reverse break fee payable by BCE in certain circumstances
has also been increased from $120 million to $200 million.
Election of Consideration
MTS shareholders may elect to receive either (i) the cash consideration of $40.00 per MTS common share, or (ii) the share
consideration of 0.6756 of a BCE common share for each MTS common share. Shareholders may only elect to receive cash
consideration or share consideration for all their shares; shareholders may not elect to receive a combination of cash and shares.
However, any election by a shareholder is subject to proration and rounding, such that the aggregate consideration to be paid to MTS
shareholders will be 45% in cash and 55% in BCE common shares, and therefore shareholders may ultimately receive a combination
of cash and BCE common shares by operation of the proration provisions of the Arrangement.
Election Deadline Announced
Registered shareholders may make an effective election by depositing with Computershare Trust Company of Canada, on or prior to
5:00 p.m. (Toronto time) on March 14, 2017, a duly completed letter of transmittal and election form indicating their election,
together with the certificates (if applicable) representing their MTS common shares. The letter of transmittal and election form is
available on our website at www.mts.ca/investors and on www.SEDAR.com or by contacting Computershare Trust Company of
Canada. Any questions regarding receipt of the cash or share consideration, including any request for another copy of the letter of
transmittal and election form, should be directed to Computershare Trust Company of Canada by phone at 18779828757
(toll free in North America) or by email at corporateactions@computershare.com.
Nonregistered shareholders that hold MTS common shares through an intermediary, such as a broker, investment dealer, bank or trust
company, should carefully follow the instructions and deadlines from the intermediary that holds shares on their behalf and should
contact such intermediary with any questions about their election. Shareholders who may have made an election through an
intermediary prior to the date of this news release may wish to contact their intermediary prior to the election deadline to verify that
their election has been made properly.
Any MTS shareholder who fails to properly make an election prior to 5:00 p.m. (Toronto time) on March 14, 2017 will be deemed to
have elected to receive, for each MTS common share, the cash consideration, subject to proration and rounding. MTS recommends
that MTS shareholders take the necessary steps to ensure that their letter of transmittal and election form is returned to Computershare
Trust Company of Canada by 5:00 p.m. (Toronto time) on March 14, 2017. There can be no guarantee that Canada Post will be able to
deliver the letter of transmittal and election form and enclosures by such time, and MTS shareholders using a courier service or
mailing through Canada Post, by regular post, registered mail or otherwise, do so at their own risk.
An MTS shareholder who has elected to receive share consideration or cash consideration but, because of proration, receives a
combination of BCE common shares and cash, will be required to make a joint election to obtain a full or partial tax deferral. A tax
instruction letter providing certain instructions on how to complete the tax election may be obtained at BCE’s website
at bce.ca/investors/shareholderinfo/mtsacquisition on closing, which is expected on March 17, 2017.
Advisors and Legal Counsel
MTS’ financial advisors are Barclays Capital Canada Inc., CIBC World Markets Inc. and TD Securities Inc. MLT Aikins LLP and
Stikeman Elliott LLP are serving as legal counsel to MTS. DFH Public Affairs is serving as public affairs and communications counsel
to MTS.
