A group led by the Ontario Teachers' Pension Plan has taken a step closer to launching a competing bid for BCE, the Montreal-based telecoms company, after lining up financing from a consortium led by Citigroup.

BCE disclosed this week that it was in buy-out talks with three Canadian pension funds and Kohlberg Kravis Roberts, the New York-based private equity group. BCE, parent of Bell Canada, the country's biggest phone operator, has a market value of C$31bn ($27.5bn).