05:00:32 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Enbridge Inc
Symbol ENB
Shares Issued 852,134,880
Close 2015-03-31 C$ 61.05
Market Cap C$ 52,022,834,424
Recent Sedar Documents

Enbridge makes Cdn asset proposal to Enbridge Income

2015-03-31 19:38 ET - News Release

Also News Release (C-ENF) Enbridge Income Fund Holdings Inc

Mr. Al Monaco reports

ENBRIDGE MAKES FORMAL PROPOSAL TO TRANSFER CANADIAN LIQUIDS PIPELINE BUSINESS AND RENEWABLE ENERGY ASSETS TO ENBRIDGE INCOME FUND

Enbridge Inc. has delivered a formal proposal to the boards of Enbridge Commercial Trust (ECT) and Enbridge Income Fund Holdings Inc. (EIFH) to transfer Enbridge's canadian liquids pipelines business, comprising Enbridge Pipelines Inc. (EPI) and Enbridge Pipelines (Athabasca) Inc. (EPA), along with certain renewable energy assets, to Enbridge Income Fund.

The formal proposal follows the Dec. 3, 2014, announcement of the proposed Canadian restructuring plan. The general terms and projected financial outcomes of the proposed transfer are substantially consistent with those originally described in that announcement.

The transaction is anticipated to provide Enbridge with an alternative source of lower-cost financing through which to support enterprise-wide growth initiatives and is expected to be accretive to Enbridge earnings per share by approximately 10 per cent per year on average from 2015 to 2018. It would also be transformational for the fund, significantly increasing its business scale and scope, providing a highly transparent source of long-term growth. Based on Enbridge's planning and financing assumptions, EIFH's dividend is expected to be increased by approximately 10 per cent on closing of the transfer in mid-2015, and by a further 10 per cent at the beginning of 2016 and each year thereafter through 2019. The dividend growth subsequent to the initial transfer would be driven by a combination of the substantial organic growth within the business being transferred, and by EIFH increasing its ownership in the fund over time.

"This is an important step forward in the execution of the Canadian restructuring plan," said Al Monaco, Enbridge president and chief executive officer. "Our program to optimize our cost of capital for the benefit of our investors is on track."

The proposed transfer was approved in principle by Enbridge's board of directors in December, 2014, but remains subject to finalization of internal reorganization steps, and a number of internal and external consents and approvals, including all necessary shareholder and regulatory approvals and final approval of definitive transfer terms by the Enbridge board. The transfer also remains subject to approval by the boards of ECT and EIFH, following a recommendation by a joint special committee. The joint special committee has been established and comprises independent directors of EIFH and independent trustees of ECT, and has engaged independent financial, technical and legal advisers to support its assessment of the proposed transfer. Assuming all necessary consents and approvals are obtained, the transfer and initial investment by EIFH are targeted for completion by mid-2015. However, there can be no assurance that the planned restructuring will be completed in the manner contemplated, or at all, or that the current market conditions and Enbridge's future forecast, based on such market conditions, will not materially change.

Further details of the Canadian restructuring plan, and the Canadian liquids pipelines business and the renewable energy assets, can be found in the Dec. 3, 2014, news release.

Update on U.S. restructuring plan

Enbridge is also in the process of reviewing a potential parallel U.S. restructuring plan, which would involve transfer of its directly held U.S. liquids pipelines assets to its U.S. affiliate, Enbridge Energy Partners LP (EEP). This review has not yet progressed to a conclusion.

We seek Safe Harbor.

© 2024 Canjex Publishing Ltd. All rights reserved.