TELUS announced today it has successfully closed its previously announced offering of US$1.5 billion aggregate principal amount of Fixed-to-Fixed Rate Junior Subordinated Notes in two series (together, the "US Notes"). The US Notes were offered through a syndicate of underwriters led by CIBC Capital Markets, BMO Capital Markets, TD Securities and Wells Fargo Securities. TELUS also announced today it has successfully closed its previously announced offering of CAD$800 million aggregate principal amount of Fixed-to-Fixed Rate Junior Subordinated Notes in two series (together, the "Canadian Notes"). The Canadian Notes were offered through a syndicate of agents led by CIBC Capital Markets, BMO Capital Markets and TD Securities.
"Our successful cross currency hybrid note offerings reinforce our proactive approach to capital management and commitment to deleveraging, while maintaining the financial flexibility to support our capital allocation priorities," said Darren Entwistle, President and CEO. "Our significant progress in deleveraging is complemented by our strong financial momentum, including our confidence in delivering free cash flow at a compounded annual growth rate of minimum 10 per cent through 2028. This positive outlook provides a sustainable foundation to continue paying the dividend at its nominal level and support our clearly defined plan to advance and systematically step down the Discounted DRIP beginning in the first quarter of 2026. Importantly, these offerings and strategic undertakings, in combination with a number of other undertakings, support our efforts to reach a leverage ratio of approximately 3.3-times by the close of 2026 as we advance toward our target of approximately 3-times by year-end 2027."
A portion of the net proceeds of the US Notes and Canadian Notes offerings will be used to fund the previously announced tender offer, which commenced on December 4, 2025, to purchase for cash up to CAD$500 million (the "Maximum Purchase Amount") of TELUS' outstanding 3.95% Notes, Series CAB due February, 2050, 4.10% Notes, Series CAE due April, 2051, 4.40% Notes, Series CU due January, 2046, 4.40% Notes, Series CL due April, 2043, 4.70% Notes, Series CW due March, 2048, 2.85% Notes, Series CAF due November, 2031 and 4.75% Notes, Series CR due January, 2045 (the "Tender Offer"). TELUS has the right to increase, decrease or waive the Maximum Purchase Amount, in its sole discretion. TELUS intends to use the remaining net proceeds from the offerings not applied to the Tender Offer for the repayment of outstanding indebtedness, including the redemption of all of the CAD$600 million aggregate principal amount outstanding on TELUS' 3.75% Notes, Series CV due March, 2026 and for other general corporate purposes.