TELUS Corp Raises $1.5 Billion Through Junior Subordinated Notes Offering for Financial Flexibility
- TELUS Corp has priced a $1.5 billion offering of Junior Subordinated Notes to enhance financial flexibility.
- The offering consists of two series, maturing in 2055, with interest rates of 6.625% and 7.000%.
- Proceeds will fund tender offers, debt repayment, and support TELUS' innovation and market expansion efforts.
TELUS Corp Secures $1.5 Billion Through Junior Subordinated Notes Offering
In a significant move aimed at enhancing its financial flexibility, TELUS Corp announces the pricing of a $1.5 billion offering of Fixed-to-Fixed Rate Junior Subordinated Notes. The offering is structured into two distinct series, with the first series comprising $700 million of notes due on October 15, 2055. This series offers an initial interest rate of 6.625%, which is set to reset every five years based on the Five-Year U.S. Treasury rate, plus a spread of 2.769%. Importantly, the rate will not fall below the initial 6.625%. The second series, valued at $800 million, also matures on October 15, 2055, and starts with a higher interest rate of 7.000%, subject to a similar reset mechanism.
The syndicate of underwriters leading this offering includes major financial institutions such as J.P. Morgan Securities LLC, RBC Capital Markets, and Wells Fargo Securities, with the closure of the offering expected around June 27, 2025, pending standard conditions. This strategic financing move is primarily intended to fund TELUS' previously announced tender offers, while any remaining proceeds will be allocated for debt repayment and general corporate purposes. The approval from credit rating agencies, which assigned a 50% equity credit to these notes, indicates a strong market confidence in TELUS' long-term financial stability.
As a leading communications technology company operating in over 45 countries, TELUS generates annual revenues exceeding C$20 billion and serves over 20 million customers. The company's focus extends beyond telecommunications; it is dedicated to enhancing human outcomes through innovative technology, with significant investments in sectors such as health and agriculture. This strategic offering not only supports TELUS' current operational needs but also positions the company to continue its mission of leveraging technology for positive societal impact.
In addition to the notes offering, TELUS' ongoing commitment to innovation in technology reflects its broader strategic objectives. The company continually seeks to improve its service offerings and expand its market reach, thereby reinforcing its position in the competitive telecommunications landscape. The proceeds from this financial maneuver are set to play a crucial role in enabling TELUS to pursue its long-term goals while maintaining a strong balance sheet.
