DISK004:[98CLG6.98CLG3726]BA3726A.;28 - About TELUS

BENEFITS OF THE TRANSACTION
As a result of the business combination, management of both BC TELECOM and TELUS expect that
BCT.TELUS will be in a better position to meet the challenge of competitors entering its traditional serving
territory. Through its relationship with GTE, BCT.TELUS expects to have access to the software and related
technology to allow it to develop new products and businesses and add breadth and depth to its
existing businesses.
The business combination will take advantage of the strategic and operational compatibility of
BC TELECOM and TELUS and should result in the following benefits: (i) creation of a platform for long-term
growth and expansion into new geographic areas and emerging communications business sectors; (ii) realization
of substantial synergies, including cost savings through the combination of duplicated functions; (iii) enhanced
access to capital markets as a result of greater financial strength, market capitalization and increased public
float; and (iv) an alliance with GTE, a telecommunications leader in the provision of voice, data and
internet services.
Platform for Growth
Management of BC TELECOM and TELUS believe that the business combination will provide a strong
platform for growth in revenue and earnings as it will strengthen the ability of BCT.TELUS to compete
effectively in its core businesses, to develop new businesses and to expand outside its traditional serving territory.
In particular:
(a) The business combination will facilitate market entry in new geographic regions in which
BC TELECOM is currently restricted from operating and in which TELUS does not presently operate;
and
(b) BCT.TELUS will have greater scale and scope, giving it the flexibility and financial capacity to pursue
acquisitions and other growth opportunities.
Synergies
Management of both companies believe that their contiguous serving territories and shared core
competencies in wireline and wireless communications businesses will allow BCT.TELUS to take advantage of
cost synergies. BC TELECOM and TELUS estimate that by the third year, annual operating cost savings could
amount to approximately $250 million, and annual capital cost savings could amount to approximately
$115 million. Estimated one-time costs to achieve these savings are expected to be in the range of $250 million to
$300 million. See ‘‘Investment Considerations — BCT.TELUS Considerations’’.
The operating and capital cost savings are anticipated to be realized principally by: (i) reduction of
corporate overhead through the implementation of a single management team; (ii) realization of infrastructure
efficiencies, improvements and general cost savings in areas such as network operations and information
systems, including data operations, applications development and maintenance; and (iii) capital cost savings
through enhanced purchasing power, inventory efficiencies and leveraging access to GTE’s procurement
strengths and pricing.
Enhanced Capital Markets Profile and Financial Resources
It is anticipated that BCT.TELUS will have substantial financial capacity, enhanced access to capital and
greater ability to pursue growth opportunities, as indicated by the following:
(a) Revenues, EBITDA and Assets — For the nine months ended September 30, 1998, the pro forma
consolidated revenues of BCT.TELUS are $4.3 billion, pro forma EBITDA is $1.7 billion and pro
forma consolidated assets amount to $7.9 billion;
(b) Credit Ratings — Subsequent to the merger announcement, the Dominion Bond Rating Service
reaffirmed the ratings of all of the rated securities of BC TELECOM, BC TEL and TELUS
Communications Inc., all with a stable outlook. The Canadian Bond Rating Service has placed the
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