Just one week after reports that the largest investor in Bell Canada was putting together a consortium to take the company over, BCE, Bell Canada’s parent, announced that it was talking about going private with another investor group.

BCE, which is widely held, has a market value of about US$26.5 billion. A buyout of the 127-year-old company would be the largest ever attempted in Canada and could cost about $US45 billion.

What makes this situation so interesting is that the rival investor groups are led by public employee retirement plans. On one side is the Ontario Teachers’ Pension Fund, the largest investor in Bell Canada, which owns 5.3%. The Fund has been openly critical of BCE’s management. On the other side is a group led by The Canada Pension Plan board which manages the funds held by Canada’s national public pension program wants a friendly takeover.

The latest negotiations may not mark the end of bidding for BCE. The Ontario Teachers’ fund said that it was still considering "leading an alternative Canadian consortium." This could include several other large Canadian funds, including one that invests for municipal workers in Ontario.