VANCOUVER – Telus is offering its shareholders another chance to approve a plan that would see them attain equal voting rights.
After dropping its original proposal in May, Telus said Tuesday that shareholders will be asked on October 17 to vote on a plan allowing them to exchange non-voting shares into common shares on a one-for-one basis. The telco added that the plan will require approval from two-thirds of its non-voting share votes, and a simple majority of common share votes cast at the meeting.
"With this proposal we are responding to the overwhelmingly positive support from shareholders since we introduced our first proposal to convert non-voting shares into common shares in late February," said president and CEO Darren Entwistle, in a statement. "Excluding Mason Capital, proxies representing 92.4 per cent of total shares received were in favour of our first proposal before we withdrew it in May. At that time we pledged to introduce another proposal for a one-for-one exchange in due course, and we are fulfilling that promise with today's announcement."
Shareholder Mason Capital has fought Telus’ plan for months, recently calling for its own meeting with Telus’ voting shareholders to ask them to change the company’s bylaws to allow for a higher valuation for the voting shares. The U.S. hedge fund contends a premium should be paid to voting class shareholders due to a subsequent windfall that would be created for those holding less valuable non-voting shares, and vowed once again to “vigorously oppose” Telus' proposal.
“Mason fully stands by its requisition for a shareholders meeting to give the voting shareholders of Telus – who have paid a premium for their voting rights – the opportunity to vote on a binding change to Telus’ articles to establish an appropriate minimum premium to be paid in any dual-class collapse transaction”, said principal and co-founder Michael Martino, in a statement. “Only the voting shareholders would have the right to vote at the meeting as the proposal in no way interferes with the rights or privileges of the holders of non-voting shares. Mason and its counsel anticipated that Telus would attempt to frustrate this proposal by falsely claiming that the non-voting shareholders are also entitled to a vote. Mason will take appropriate steps to see its requisition through.”
Telus said that it currently has approximately 175 million common shares and 151 million non-voting shares issued and outstanding. If approved, the proposal would result in a single class of approximately 326 million common shares which would be listed on the New York Stock Exchange for the first time.
– Lesley Hunter
