TELUS unit closes upsized IPO

TELUS Corp. unit TELUS International (Cda) Inc. on Feb. 5 closed its upsized offering of 42.55 million subordinate voting shares at $25 per share.

This includes 5.55 million subordinate voting shares bought upon the full exercise of the underwriters' overallotment option to buy additional subordinate voting shares from TELUS and Baring Private Equity Asia, the selling shareholders.

The offering generated total gross proceeds of $1.06 billion, including the full exercise of the overallotment option. The net proceeds to TELUS International are expected to be about $490 million, and are likely to be used to repay outstanding borrowings under its revolving credit facilities.

TELUS International will not receive any proceeds from the subordinate voting shares sold by the selling shareholders, the company said in a press release.

The subordinate voting shares sold in the IPO included nearly 21 million subordinate voting shares from TELUS International treasury and approximately 21.55 million subordinate voting shares from the selling shareholders.

As of the IPO closing, and including the impact from the exercise of the underwriters' overallotment option, TELUS held 67% of the voting power of TELUS International and 55.2% of the economic interest, and Baring held nearly 30.7% of the voting power of TELUS International and 25.3% of the economic interest.

The subordinate voting shares started trading on the New York Stock Exchange and the Toronto Stock Exchange on Feb. 3 under the ticker "TIXT."

J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC acted as joint lead bookrunning managers for the IPO, while Barclays Capital Inc., BofA Securities Inc. and CIBC World Markets Inc. also acted as active bookrunning managers.

Other bookrunning managers include Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, RBC Dominion Securities Inc., Robert W. Baird & Co. Inc., BMO Nesbitt Burns Inc., Scotia Capital Inc., TD Securities Inc., Wells Fargo Securities LLC and William Blair & Co. LLC.

Meanwhile, MUFG Securities Americas Inc., National Bank Financial Inc., Loop Capital Markets LLC and R. Seelaus & Co. LLC served as co-managers.