Enbridge to acquire US pipeline operator SEP

Canada

CALGARY, August 24, 2018 – Enbridge will buy the outstanding public common shares of its US subsidiary Spectra Energy Partners (SEP) for USD 3.3 billion, the Canadian pipeline operator announced in a company statement on Friday.

The deal offers SEP shareholders the opportunity to continue concentrating on distribution growth. According to Enbridge, SEP shareholders will see multiple benefits including a stronger balance sheet and enhanced trading liquidity.

“If SEP were to continue as a stand-alone entity in such an environment, it would be required to transition to a self-funding model using internally generated cashflow,” the company statement said. “SEP’s priority would be to strengthen its balance sheet, thereby limiting future distribution growth.”

The acquisition, worth 9.8% more than a previous offer made in May, has already been approved by the boards of both companies and is expected to close in Q4 2018.