On June 21, 2007, Standard&Poor's Ratings Services placed its ratings, including the 'BBB+' long-term corporate credit rating, on Vancouver, B.C.-based communication services provider Telus Corp. on CreditWatch with negative implications. The action reflects the company's announcement that it has entered into nonexclusive discussions to acquire BCE Inc. (A-/Watch Neg/A-2). We expect the transaction, if completed, will be funded by a combination of Telus' shares and new debt, which would lead to pro forma debt leverage (including operating synergies) and corresponding credit metrics that would weaken the current "modest" levels. However, Telus' management has publicly indicated its desire to maintain investment-grade ratings. The combined Telus-BCE entity will emerge as the largest telecommunications player in Canada with pro forma revenues
