TORONTO Nov 30 Telus Corp said on Friday
that it believed U.S. hedge fund Mason Capital Management LLC
has begun to sell down its positions in the telecom company,
which can now resume selling shares to foreign investors.
Mason's investment forced Telus to disallow foreigners from
acquiring shares of the company because Canadian laws prohibit
foreign ownership of more than 33.3 percent in any large
Canadian telecom player.
Mason had accumulated simultaneous long and short positions
on the company's voting and nonvoting shares, and stood to
benefit if Telus' plan to consolidate the two classes of stock
on a 1-for-1 basis failed.
The two sides have been locked in a war of words for months.
Mason has said Telus' voting class shareholders should be
rewarded as the two classes merge because they paid more for
their stock than nonvoting shareholders did. Telus said it did
not see the need for paying a premium as universal voting rights
amounted to good corporate governance.
Last month, Telus shareholders dealt a blow to Mason, voting
to approve the company's share exchange plan. Mason has sued to
block the plan, however, and a court ruling in the matter is
expected in coming weeks.
Telus said its foreign ownership had fallen to about 15
percent on Nov. 16 from nearly 33 percent in July.
As a result, Telus can allow foreigners to acquire its
shares gain, it said.
Telus said it also had observed a significant reduction in
the short positions in its voting and nonvoting shares.
"Based in part on this change in foreign ownership levels
and short trading positions, Telus believes Mason Capital has
materially reduced both its long and short positions," Telus
said in its statement.
In August, Mason had disclosed an ownership stake of close
to 19 percent of Telus' voting shares.
A spokesman for Mason declined to comment on its investment.
Telus' voting shares rose 53 Canadian cents to C$65.10 in
early trading on the Toronto Stock Exchange, while the nonvoting
shares were up 41 Canadian cents at C$64.15.