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Enbridge to buy Spectra Energy in stock deal worth $37B

Expects to achieve operational savings worth about $540 million.

September 6, 2016   by CP STAFF

CALGARY — Enbridge Inc. of Calgary plans to buy Houston-based Spectra Energy Corp. for stock worth $37 billion.

The combination of the two pipeline companies would create a North American energy infrastructure giant, to be called Enbridge Inc. and headquartered in Calgary.

The combined company’s natural gas pipelines business would be based in Houston and the liquids pipelines business would be based in Edmonton.

The companies say they expect to achieve operational savings worth about $540 million on an annualized basis, most of it achieved in the latter part of 2018. They also expect an additional $260 million of tax savings beginning in 2019.

Under the proposed deal, shareholders of Enbridge would own about 57% of the combined company and the rest would be owned by Spectra shareholders.

They expect the combined company will pay higher dividends, including a 15 per cent increase on current levels in 2017 after the deal closes.


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