Mason Capital Urges Shareholders to Vote the Blue Proxy and Reject TELUS’ One-for-One Share Collapse Proposal

  Mason Capital Urges Shareholders to Vote the Blue Proxy and Reject TELUS’
  One-for-One Share Collapse Proposal

Proposal Would Result in Voting Shareholders Losing Substantial Value and 46%
                               of Voting Power

   Highlights Concerns Regarding TELUS’ Oppressive Actions and Conflicts of

Business Wire

NEW YORK -- October 11, 2012

Mason Capital Management LLC ("Mason") today reiterated several serious
concerns with the actions of TELUS Corporation (TSX:T, T.A; NYSE: TU) relating
to its proposal to exchange all of its non-voting shares for voting shares on
a one-for-one basis. The proposal is scheduled to be voted on at an October 17
^ meeting of TELUS shareholders.

TELUS voting shares historically are more valuable than non-voting shares and
have traded at a premium. In the 13 years prior to TELUS’ initial proposal in
February 2012, $98 billion in TELUS voting shares traded at an average premium
of 4.83% relative to the non-voting shares, with the premium reaching as high
as 15.23%. This proposal, if passed, will result in a loss of substantial
value to the class of voting shareholders, which Mason estimates at
approximately $200 million based on the elimination of the historical premium.
In addition, voting shareholders will be forced to relinquish 46% of their
voting power and will receive no compensation. Leading proxy advisory firm
Institutional Shareholder Services Inc. (“ISS”) recognizes the flaws
associated with TELUS’ proposal, stating that: “The proposed exchange ratio…
in veering off from the well-established, enduring market ratio, is a cause
for concern, and should legitimately be scrutinized by shareholders.”^1

Michael Martino, Mason’s principal and co-founder, said: “It is imperative
that all voting shareholders arm themselves with the facts about the true
economic implications of TELUS’ proposal, which based on precedents, is one of
the worst offers for holders of shares with superior voting rights in a share
collapse seen in Canada in over a decade. Mason would support a share collapse
at an exchange ratio that accounts for the superior value of the voting shares
in the same way the market has accounted for that superior value for over 13
years. We urge shareholders to reject this oppressive proposal and force TELUS
management to come back with an exchange ratio that provides voting
shareholders with the compensation they deserve.”

Martino continued, “It is unfortunate that TELUS has sought to distract
investors and deflect attention from its flawed proposal by making egregious
comments about a significant shareholder. We encourage voting shareholders to
consider the way that TELUS has conducted itself and treated shareholders over
the last several months. In addition to ignoring shareholder concerns
regarding the proposed exchange ratio, TELUS has taken several actions to push
through its one-for-one proposal at any cost, including actions aimed at
manipulating the October 17 vote that raise serious concerns regarding TELUS’
commitment to ethical standards and corporate governance.”

Mason cited the following issues as causes for significant voting shareholder

TELUS’ board is shirking its fiduciary duties.

  *TELUS continues to ignore the fact that voting shares are historically –
    and fundamentally – more valuable than non-voting shares.
  *Despite repeated attempts to engage TELUS to discuss conversion options
    and an exchange ratio that would treat ALL shareholders fairly, TELUS’
    board and management remain unwilling to consider anything beyond the
    unfair and oppressive one-for-one exchange.
  *TELUS was forced to withdraw the very same proposal it is seeking today
    because it faced certain rejection by shareholders in May.
  *Despite material conflicts of interest at the board and management level,
    TELUS never obtained a fairness opinion for the voting shareholders.
  *Instead, TELUS relied on a severely flawed opinion from Scotiabank, which
    was based upon the wrong precedents and misinterpreted the facts.
    Specifically, like TELUS, Scotia gave no weight to market trading prices –
    whether at TELUS or in its precedents – in determining what is fair.

TELUS has engaged in questionable actions aimed at manipulating the vote.

  *Rather than respecting the rights afforded to shareholders by allowing the
    vote to play out fairly, TELUS continues to engage in a
    highly-controversial tactic known as “vote buying,” paying dealer
    solicitation fees for votes – but only for votes in favor of the proposal.
  *TELUS has reduced the minimum voting level for approval by voting
    shareholders from 66.6% to 50% in a coercive effort to tip the scale in
    its favor and force through its proposal.

TELUS’ board and management have alarming conflicts of interests and stand to
make a windfall as a result of this one-sided proposal.

  *The majority of TELUS’ management team and board’s holdings are tied to
    the non-voting shares. As a group, the management team and board hold
    approximately $150 million more in non-voting shares than voting shares
    and stand to make approximately $4 million at the expense of voting
    shareholders (based on the elimination of the historical price premium) if
    this proposal is approved.
  *Bernard Black, Professor of Law at Northwestern University’s Law School
    and Kellogg School of Management, notes this clear conflict of interest,
    stating that the board and management “have a negative economic interest
    in the value assigned to votes.”^2
  *Mr. Black adds that, “in the US, this conflict-of-interest would cause a
    court to assess management’s decision to propose a zero-premium,” and
    highlights the fact that “despite their conflict of interest, management
    plans to vote its own voting shares in favor of the share swap.”^2

We urge you to exercise your FULL voting power while you still can and vote
the BLUE proxy to reject TELUS’ proposal and force TELUS to either come back
with a fair exchange ratio, or drop its proposal altogether.

Mason’s dissident proxy circular is available on TELUS’ company profile on


       Any questions and requests for assistance may be directed to the
                          Proxy Solicitation Agent:

                          Shareholder Services Inc.

                              The Exchange Tower
                130 King Street West, Suite 2950, P.O. Box 361
                               Toronto, Ontario
                                   M5X 1E2

                       North American Toll Free Phone:
                           Facsimile: 416-867-2271
                     Toll Free Facsimile: 1-866-545-5580
     Outside North America, Banks and Brokers Call Collect: 416-867-2272

Forward looking statements:

This press release contains statements about expected future events that are
forward-looking. By their nature, forward-looking statements require Mason to
make assumptions and predictions and are subject to inherent risks and
uncertainties. Whether actual results and developments will conform with our
expectations and predictions is subject to a number of risks, assumptions and
uncertainties, many of which are beyond our control, and the effects of which
can be difficult to predict, including, without limitation, risks, assumptions
and uncertainties related to: the approval of the Proposal by shareholders,
the consummation of the Proposal by TELUS; actions taken by TELUS to frustrate
Mason’s actions or objectives; changes in market conditions; the market value
and trading price of the Common Shares; the level of foreign ownership of
TELUS; actions taken by TELUS to remedy a breach of the foreign ownership
levels; intervention by regulators or the courts; and other factors set out in
TELUS’ Management Circular. In evaluating any forward-looking statements in
this press release, we caution readers not to place undue reliance on any
forward-looking statements. Readers should specifically consider the various
factors which could cause actual events or results to differ materially from
those indicated by our forward-looking statements. There is significant risk
that the forward-looking statements will not prove to be accurate. Unless
otherwise required by applicable securities laws, we do not intend, nor do we
undertake any obligation, to update or revise any forward-looking statements
contained in this press release to reflect subsequent information, events,
results or circumstances or otherwise.

^1 ISS Proxy Advisory Services Report on TELUS Corporation; September 28, 2012

^2 “Equity Decoupling and Empty Voting: The Telus Zero-Premium Share Swap,”
Bernard C. Black; September 28, 2012


Sard Verbinnen & Co
Jonathan Gasthalter/Dan Gagnier/Brooke Gordon
+1 (212) 687-8080
NATIONAL Public Relations
Peter Block / Sarah Coombs / Jennifer Lee
+1 (416) 586-0180
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