By Cristal Cody
Tupelo, Miss., March 4 - Enbridge Inc. said on Tuesday that the company priced an upsized C$275 million of cumulative redeemable preference shares to yield a 4.4% dividend through the initial fixed-rate period to but excluding Dec. 1, 2019.
Enbridge sold 11 million shares of the series 9 preferred stock (Baa3/BBB/DBRS: Pfd-2) at C$25.00 per share.
The deal was upsized from C$200 million, or 8 million shares.
TD Securities Inc., CIBC World Markets Inc., RBC Dominion Securities Inc. and Scotia Capita Inc. were the lead managers.
The dividend rate will reset on Dec. 1, 2019 and every five years thereafter at a rate equal to the sum of the then five-year U.S. government bond yield plus 266 basis points.
The series 9 preference shares are redeemable by Enbridge at its option on Dec. 1, 2019 and every fifth year thereafter.
The holders of Series 9 preferred shares will have the right to convert their shares into series 10 cumulative redeemable preference shares on Dec. 1, 2019 and on December 1 of every fifth year thereafter. Series 10 preference shareholders will be entitled to receive quarterly floating-rate cumulative dividends at a rate equal to the 90-day Government of Canada treasury bill plus 266 bps.
The Calgary, Alta.-based oil and gas distributor and transportation company plans to use the proceeds from the deal to partially fund capital projects, reduce existing debt and for other general corporate purposes.
| Issuer: | Enbridge Inc.
|
| Amount: | C$275 million, 11 million shares
|
| Maturity: Dec. 1, 2019
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| Securities: | Cumulative redeemable preference shares
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| Bookrunners: | TD Securities Inc., CIBC World Markets Inc., RBC Dominion Securities Inc. and Scotia Capita Inc.
|
| Price: | C$25.00 per share
|
| Dividend: | 4.4%; resets Dec. 1, 2019 and every five years thereafter at the then five-year Government of Canada bond yield plus 266 bps
|
| Call feature: | Dec. 1, 2019 and on December 1 of every fifth year thereafter
|
| Pricing date: | March 4
|
| Settlement date: | March 13
|
| Ratings: Moody's: Baa3
|
| Standard & Poor's: BBB
|
| DBRS: Pfd-2
|
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