Canadian incumbent Telus has vowed to take its activist investor Mason Capital to court after the New York hedge fund announced plans to hold a shareholder meeting on the same day Telus plans to hold one.
In a statement, Telus describes Mason’s…
Canadian incumbent Telus has vowed to take its activist investor Mason Capital to court after the New York hedge fund announced plans to hold a shareholder meeting on the same day Telus plans to hold one.
In a statement, Telus describes Mason’s planned meeting and propositions as undemocratic and in breach of Canadian law.
Mason holds roughly 20% of Telus’ stock and is staunchly against the operator’s plan to collapse its dual-class share structure.
In May the hedge fund effectively blocked Telus’ plans to merge its two classes of stock.
Last month Telus announced it was renewing plans to convert all its shares into voting shares, and lowering the shareholder approval threshold from two thirds to a simple majority to get the change through.
On Friday last week Mason said it would hold a separate shareholder meeting on the same day as Telus’ meeting to vote on the conversion. Mason’s meeting centres on a proposition to give holders of voting stock a guaranteed premium of at least 4.75% more than holders of non-voting stock in the event of Telus successfully collapsing its dual-class structure.
Telus CFO Robert McFarlane alleged in a statement that Mason’s plan to hold a second shareholder meeting the same day was designed to widen the spread between Telus two classes of shares to the hedge fund’s advantage.
“We believe that Mason’s meeting and resolutions are undemocratic and invalid under Canadian law,” he said. “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.”
Both meetings are currently scheduled for 17 October.
