Nov. 26 (Bloomberg) -- BCE Inc. plunged in early Canadian trading after the company said that its C$52 billion ($42 billion) may not close on time because of the credit crunch, stoking speculation the record buyout may fail.

Thomson Reuters Corp. may decline, bids showed, on an analyst downgrade. EnCana Corp. may rise on higher oil prices, bids indicated.

“It looks unlikely that the BCE deal will be completed,” said Michael Smedley, who helps manage about $1.2 billion at Morgan Meighen & Associates in Toronto. “It’s the most serious local market event to take place during this long financial crisis.”

The Standard & Poor’s/TSX Composite Index added 1.99 points, or less than 0.1 percent, to 8,442.86 yesterday in Toronto. Canada’s main stock benchmark has fallen 39 percent this year, poised for its worst annual drop on record, after worldwide credit losses approached $1 trillion and commodity prices slumped.

BCE dropped C$15.34, or 40 percent, to C$23.01 in Toronto. BCE, which planned to go private by Dec. 11, said KPMG has evaluated the company and said it would probably be insolvent if it completes the deal under current terms and market conditions,

KPMG also said the phone company’s current capital structure meets solvency requirements, BCE said.

Thomson Reuters may drop C$1 to C$27.75, according to bids. The provider of financial and legal data was cut to “sell” from “hold” by Royal Bank of Scotland analysts led by Paul Gooden in London.

EnCana may gain C$2.40 to C$53.38m based on bids. Crude oil rose after China cut interest rates for the fourth time in 10 weeks to boost the country’s slowing growth.

U.S. stock futures tumbled, indicating the Standard & Poor’s 500 Index may snap a three-day advance, after orders for durable goods fell twice as much as forecast and consumer spending declined the most since 2001.

To contact the reporter on this story: John Kipphoff in Toronto at jkipphoff@bloomberg.net.

Last Updated: November 26, 2008 09:28 EST