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ISS re-iterates recommendation that TELUS shareholders vote in favour of share conversion proposal

VANCOUVER April 27, 2012 April 23 New York

As referenced by ISS, "if announcement of the transaction itself increased the company’s market value higher, voting down the transaction should logically result in the loss of some or all of that incremental market value." Despite this, Mason is seeking to defeat the proposal because it believes that the trading price of the Non-Voting Shares will decrease more than the trading price of the Common Shares and therefore Mason will profit because the gain on its Non-Voting Share short position would exceed any loss on its offsetting Common Share position. This is in stark contrast to other holders of Common Shares and Non-Voting Shares whose interest is in seeing the shares appreciate in value.

February 21 $535 million $583 million

Further, ISS wrote – "As the proposed transaction would align voting rights with economic interest, offers shareholders meaningful economic opportunity through increased trading liquidity and a dual listing on the NYSE, and has been ratified by a strong market response – and as the company’s Articles effectively preclude any exchange ratio other than the proposed one-for-one exchange – a vote FOR the proposal is warranted."

Darren Entwistle

May 7

On Thursday TELUS sent a letter to its shareholders refuting Mason’s position and asking for their support in the current vote on its proposal. [email protected] [email protected]


TELUS has previously communicated that the share conversion was proposed in response to feedback from significant institutional shareholders and would result in the extension of voting rights to all TELUS shareholders. The proposed one-for-one conversion ratio is consistent with the company’s Articles in the event that foreign ownership restrictions are eliminated and past proposed transactions such as the planned Income Trust conversion in 2006 where both classes were to receive one trust unit for each share. The Non-Voting Shares have the same economic interest in TELUS as the Common Shares with the same dividends and strong liquidity and takeover coattail rights that ensure equal economic participation in a takeover premium.

The benefits of the proposal include:

  • Enhancing the liquidity and marketability of the Common Shares, including through a listing of the Common Shares on the NYSE for the first time. TELUS has approximately 175 million Common and 150 million Non-Voting Shares outstanding. The proposal would result in one Common Share class with approximately 325 million shares outstanding.
  • Enhancing TELUS’ leadership in respect of good corporate governance practices by granting the right to vote to shareholders holding approximately 46 per cent of the shares who have the same economic interest in the Company as the Common shareholders
  • Aligning the capital structure of the Company with what is generally viewed as best practice
  • Addressing concerns expressed by some shareholders about the impact of TELUS’ dual- class share structure on liquidity and trading volumes.

Furthermore, TELUS retains the ongoing ability to comply with the foreign ownership restrictions and the proposal does not affect the earnings per share and dividend paid per Common Share and Non-Voting Share.

This news release contains statements about expected future events of TELUS that are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and predictions and are subject to inherent risks and uncertainties. There can be no assurance that the proposal will receive voting approval and if not approved the market price of Non-Voting Shares and/or Common Shares may decline, given that share prices in both classes increased on the announcement of the proposal. There is significant risk that the forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause actual future events to differ materially from that expressed in the forward-looking statements. Readers should review the risks and uncertainties set out in the "Forward Looking Statements" section at page 14 of TELUS’ 2012 Information Circular, available at . Except as required by law, TELUS disclaims any intention or obligation to update or revise forward-looking statements. Permission was not requested to quote from the ISS Report.


Canada $10.4 billion Darren Entwistle

$250 million Canada

SOURCE TELUS Corporation

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