8-K

ENBRIDGE INC 8-K Report (Apr 26, 2012)

Filed April 26, 2012For Securities:ENBENBMFEBBGFEBRGFEBRZFENBGFENBRFENFFFEBGEFENBFFENBHFENBNFENBOFENBSFEBBNFENNPF

Summary

Enbridge Inc. (ENB) filed an 8-K report on April 26, 2012, primarily to announce its quarterly dividend declarations. The Board of Directors declared a common share dividend of $0.2825 per share, payable on June 1, 2012. Notably, a portion of this dividend ($0.2372 per share) will not qualify for Canada's enhanced dividend tax credit due to its sourcing from dividends received from Noverco Inc., following the profitable sale of Noverco's shares in Enbridge. The remaining $0.0453 per share will be designated as an eligible dividend for Canadian tax purposes. The entire dividend is considered a qualified dividend for U.S. tax purposes. In addition to the common share dividend, Enbridge also declared dividends on its preferred shares: Series A, Series B, Series D, and Series F. All preferred share dividends are designated as eligible dividends for Canadian tax purposes. The filing also includes standard corporate information and incorporates previous registration statements by reference.

Key Highlights

  • 1Enbridge declared a quarterly common share dividend of $0.2825 per share, payable June 1, 2012.
  • 2A portion of the common dividend ($0.2372/share) will not qualify for the enhanced Canadian dividend tax credit.
  • 3The non-eligible portion of the common dividend stems from funds received after the sale of Noverco Inc. shares.
  • 4The remaining common dividend portion ($0.0453/share) is designated as an eligible dividend for Canadian tax purposes.
  • 5The full common dividend is considered a qualified dividend for U.S. tax purposes.
  • 6Dividends were also declared for Preferred Share Series A, B, D, and F, all designated as eligible dividends in Canada.
  • 7The Series F preferred shares received their first dividend payment, with a regular quarterly dividend rate to take effect from September 1, 2012.

Frequently Asked Questions

The primary purpose of this 8-K filing is to announce Enbridge Inc.'s Board of Directors' declarations of its quarterly dividends for common and preferred shares, along with important details regarding the tax treatment of the common share dividend for Canadian shareholders.

A portion of the common dividend will not qualify for the enhanced Canadian dividend tax credit because the funds being distributed originate from dividends received by Enbridge from Noverco Inc., a private company investee, following Noverco's sale of some of its shares in Enbridge. This specific sourcing impacts its tax designation in Canada.

Enbridge will notify shareholders by posting a notice on its website on or before the dividend payment date (June 1, 2012). Additionally, Canadian financial institutions will provide detailed T5 year-end tax information in early 2013 to assist taxpayers in reporting their positions.

No, all declared dividends on Enbridge's preferred shares (Series A, B, D, and F) are designated as eligible dividends for Canadian federal income tax purposes and are not affected by the tax treatment issue related to the common share dividend.