By Cristal Cody
Tupelo, Miss., May 12 - Enbridge Inc. announced on Monday that it priced C$250 million of cumulative redeemable preference shares that yield a 4.4% dividend for the fixed-rate period to but excluding March 1, 2020.
The company sold 10 million shares of the series 11 preferred stock (DBRS: Pfd-2) at C$25.00 per share.
The deal includes an over-allotment option of 2 million shares.
Scotia Capital Inc., CIBC World Markets Inc., RBC Capital Markets, and TD Securities Inc. were the lead managers.
The dividend rate will reset on March 1, 2020 and every five years thereafter at a rate equal to the sum of the then five-year Canadian Government bond yield plus 264 basis points.
The Series 11 preferred shares are redeemable by Enbridge at its option on March 1, 2020 and on March 1 of every fifth year thereafter.
Series 11 preferred shareholders will have the right to convert their shares into series 12 cumulative redeemable preference shares on March 1, 2020 and on March 1 of every fifth year. Series 12 shareholders will be entitled to receive quarterly floating rate cumulative dividends at a rate equal to the sum of the 90-day Government of Canada Treasury bill rate plus 264 bps.
The Calgary, Alta.-based oil and gas distributor and transportation company plans to use the proceeds to partially fund capital projects, reduce existing debt and for other general corporate purposes.
| Issuer: | Enbridge Inc.
|
| Amount: | C$250 million (10 million shares)
|
| Greenshoe: | C$50 million (2 million shares)
|
| Maturity: | To but excluding March 1, 2020
|
| Securities: | Cumulative redeemable preference shares
|
| Bookrunners: | Scotia Capital Inc., CIBC World Markets Inc., RBC Capital Markets and TD Securities Inc.
|
| Price: | C$25.00 per share
|
| Yield: | 4.4%; resets on March 1, 2020 and every five years thereafter at five-year U.S. Treasuries plus 264 bps
|
| Call feature: | March 1, 2020 and on March 1 of every fifth year thereafter
|
| Pricing date: | May 12
|
| Settlement date: | May 22
|
| Ratings: | DBRS: Pfd-2
|
| Distribution: | Canada
|
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