The investment-grade ratings on Canada's second-largest, diversified incumbent telecommunications provider are driven by Telus' leading local market-share position in western Canada and eastern Quebec, as well as increasing free cash flows generated by growth in the company's wireless business and lower expenses from workforce reductions in the company's wireline business. The effect of the company's operational efficiency program is expected to be net positive, as future cash savings will outstrip cash outlays for severance and other costs. In addition, the company benefits from substantial tax-loss carry forwards, with respect to the Clearnet Communications Inc. acquisition in 2000, which will reduce future cash taxes to help Telus achieve its debt reduction targets. These strengths are partially mitigated by the company's relatively
