Canadian telco Telus has withdrawn a proposal to introduce a single class of common shares in place of its current dual-share structure after conceding that it could not gain the required level of shareholder support for the move. As previously reported by CommsUpdate, Telus sought to convert non-voting shares into voting stock on a one-for-one basis, but the plan was opposed by its largest single shareholder, New York-based hedge fund Mason Capital Management, with 18.7% of outstanding common shares but a much smaller number of non-voting shares. Hours before Telus’s annual shareholder meeting on 9 May, the Vancouver-based firm acknowledged the threat that it might not win 66.6% of votes from each class of shareholder needed to approve the restructuring. Telus CEO Darren Entwistle said that Mason might have defeated the plan via what he called the ‘disgraceful practice’ of ‘empty voting’ to give the hedge fund more voting shares than its economic stake in the company, reports the Ottawa Citizen. Entwistle claimed that Telus employees (collectively the largest voting share owner with 8.2 million common shares) were disadvantaged by the actions of Mason, which began buying up voting stock after the proposal for the purpose of short-term economic profit, according to the CEO, who added that Telus remained committed to the plan to convert its non-voting stock to common shares to gain greater liquidity for the future.
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