Summary
Enbridge Inc. (ENB) filed a Form 6-K on December 22, 2017, which incorporated two press releases detailing a significant financing event. The company successfully closed a public offering of Cumulative Redeemable Minimum Rate Reset Preference Shares, Series 19, raising $500 million in gross proceeds. This offering, which included the full exercise of the underwriters' option, involved the issuance of 20 million preferred shares at $25.00 per share. These proceeds are earmarked for a combination of partially funding capital projects, reducing existing indebtedness, and general corporate purposes. The Series 19 Preferred Shares carry a fixed cumulative dividend rate of $1.225 per share annually, yielding 4.90% initially, with a reset mechanism tied to Canadian Government bond yields every five years. This issuance provides Enbridge with crucial capital to support its strategic initiatives and maintain financial flexibility.
Key Highlights
- 1Enbridge Inc. raised $500 million through the public offering of Series 19 Cumulative Redeemable Minimum Rate Reset Preference Shares.
- 2The offering involved the issuance of 20 million preferred shares at $25.00 per share, including the full exercise of the underwriters' option.
- 3Proceeds will be used to partially fund capital projects, reduce existing indebtedness, and for general corporate purposes.
- 4The Series 19 Preferred Shares offer an initial fixed dividend yield of 4.90% per annum, with dividends payable quarterly.
- 5The dividend rate is subject to reset every five years, starting March 1, 2023, based on the 5-year Canadian Government bond yield plus a spread of 3.17%.
- 6Holders have the option to convert their Series 19 Preferred Shares into Series 20 Floating Rate Preferred Shares on March 1, 2023, and every five years thereafter.
- 7The Series 19 Preferred Shares began trading on the Toronto Stock Exchange (TSX) under the symbol ENB.PF.K on December 11, 2017.