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December 12, 2008
And Now, The Break-Up
You are so worried about the recession, but I’m telling you there are
always ways to make money. We learned this week that it might even be
possible to make money by being unappealing. At least the Canadian
telecommunications company BCE is going to give it a try.
BCE, which is not in the best of ways financially, had hoped to be
acquired by a group of private equity firms led by the Ontario Teachers’
Pension Plan. The whole thing was conditioned on BCE’s accounting firm,
KPMG, giving BCE a clean financial bill of health prior to the closing
of the deal.
When KPMG gave BCE a dirty bill of health, the private equity firms
walked away from the deal.
Sounds reasonable enough, right? Not so fast! BCE now insists that the
would-be buyers owe it a “break-up fee” of $1.2 billion Canadian.
That is brilliant. Perhaps not so brilliant that BCE will ever actually
collect it, but you have to give them credit for having the chutzpah to
wanted you to buy us. You thought about it but decided not to because we
are a financial mess. But since you got our hopes up, you need to pay us
$1.2 billion for breaking up with us.
You broke our hearts!
Needless to say, this would have a huge societal impact if it were
applied to actual relationships. Just think of the relationships that
would stand a better chance of going the distance if the dumper had to
pay the dumpee a break-up fee. (Actually, we do have a form of break-up
fee, which we call divorce attorney fees, and another one we call
alimony, but it’s not exactly the same thing.)
Come to think of it, the concept is not entirely new to the business
world, although it’s usually voluntary. Sometimes employees receive
break-up fees when they are fired from their jobs. We call it severance
pay. For awhile we paid you to work here, but you were so bad at it we
thought we’d have a better chance of getting our money’s worth if we
paid you to go away.
once paid a break-up fee to a business partner that was worse than
alimony, although fortunately I got to keep my actual wife as part of
What’s different about all these circumstances, however, is that people
are only paying the break-up fee after they’ve actually been together
for some time. BCE wants these private equity firms to pay a break-up
fee even though they were never really together.
It’s like walking up to an attractive woman and asking her out, and
then, if she says no, insisting, “You owe me $100!”
The nerve! Telling you no!
seems to me that we would all be better off, in business as well as in
our personal lives, if we just did our breaking up for free. Divorce?
Firing? Split of partnership? Why get money involved? Just walk away.
After all, it’s hard to imagine a more bittersweet collection than one
you make from someone who is rejecting the notion of having you around.
Why would you want their money? Wouldn’t it only remind you of the
Every time you sit in that hot tub or drive that Porsche, you’ll think
about what that terrible person did to you. Hmm. On second thought, if
anyone wants to break up with me, I’d be glad to set up a PayPal account
to make it more convenient for you.
© 2008 North Star
Writers Group. May not be republished without permission.
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