By Cristal Cody
Prospect News, July 9 - Enbridge Inc. said it nearly doubled an initial offering on Monday and sold an upsized C$450 million of cumulative redeemable preference shares to yield a 4% annual dividend for the fixed-rate period to but excluding Dec. 1, 2018.
The company priced 18 million shares of the series N preferred stock (Baa3/BBB/DBRS: Pfd-2) at C$25 per share.
Enbridge originally announced an offering of C$250 million, or 10 million shares, of the series.
RBC Capital Markets Corp., CIBC World Markets Inc., Scotia Capital Inc. and TD Securities Inc. were the lead managers.
The preferreds are redeemable by Enbridge at its option on Dec. 1, 2018 and on Dec. 1 of every fifth year thereafter.
The dividend rate will reset on Dec. 1, 2018 and every five years thereafter at a rate equal to the then five-year Government of Canada bond yield plus 265 basis points.
Shareholders will have the right to convert the series N preferreds into series O cumulative redeemable preference shares on Dec. 1, 2018 and on Dec. 1 of every fifth year thereafter and receive quarterly floating-rate cumulative dividends at a rate equal to the sum of the then 90-day Government of Canada bill rate plus 265 bps.
Proceeds of the offering will be used to partially fund capital projects, to reduce existing debt and for other general corporate purposes.
Enbridge is a Calgary, Alta.-based oil and gas distributor and transportation company.
| Issuer: | Enbridge Inc.
|
| Amount: | C$450 million
|
| Securities: | Cumulative redeemable preference shares
|
| Bookrunners: | RBC Capital Markets Corp., CIBC World Markets Inc., Scotia Capital Inc. and TD Securities Inc.
|
| Dividend: | 4%; resets on Dec. 1, 2018 and every five years thereafter at rate equal to five-year Government of Canada bond yield plus 265 bps
|
| Price: | C$25 per share
|
| Call feature: | On Dec. 1, 2018 and on Dec. 1 of every fifth year thereafter
|
| Pricing date: | July 9
|
| Settlement date: | July 17
|
| Ratings: | Moody's: Baa3
|
| Standard & Poor's: BBB
|
| DBRS: Pfd-2
|
| Distribution: | Canada
|
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