In the latest twist in its shareholder saga, Telus Corp. (TSX-T) is seeking a court order to thwart New York hedge fund Mason Capital’s attempt to hold a shareholder meeting.
On August 21, Telus called a court-approved shareholder meeting for October 17, where all shareholders will get a vote on Telus’ share exchange proposal.
But on Friday, Mason announced that it had called another meeting for the same day.
Michael Martino, principal and co-founder of Mason Capital, said, “Today’s action furthers Mason’s efforts to protect the rights of all Telus voting shareholders. Given the oppressive actions taken by Telus to disenfranchise an entire class of shareholders, it is critical that voting shareholders have 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.
“Moreover, Telus' recycled proposal demonstrates the lengths the company is willing to go to circumvent the protections afforded to the voting shareholders under the law. Mason will continue to vigorously oppose Telus’ latest attempt to take value from voting shareholders and transfer it to non-voting shareholders, who include Telus’ board of directors and company executives, whose personal economic interests are directly tied to the non-voting stock.”
Robert McFarlane, Telus CFO and executive vice-president, said, “Mason Capital’s announcement of a second meeting the same day is an absurd tactic designed to confuse shareholders in the hope of widening the spread between the trading price of the company’s common and non-voting shares so that Mason can profit from their empty voting trading strategy.
“We believe that Mason's meeting and resolutions are undemocratic and invalid under Canadian law.
“Mason is proposing to remove key rights held by Telus’ non-voting shareholders without giving them an approval right. More than that, Mason’s resolutions would take away key benefits for all shareholders that would result from approval of Telus’ proposal to collapse its dual-share classes. Telus shares would enjoy enhanced trading volumes, liquidity and marketability, and Telus common shares would be listed on the New York Stock Exchange for the first time.”
