CALGARY, ALBERTA–(Marketwired – Sept. 23, 2016) – Inter Pipeline Ltd. (“Inter Pipeline”) (TSX:IPL) announced today the successful closing of its acquisition of the shares of The Williams Companies Inc.’s and Williams Partners L.P.’s Canadian natural gas liquids (“NGL”) midstream businesses (“Williams Canada”) for cash consideration of $1.35 billion, subject to closing adjustments.
This strategic acquisition, announced on August 8, 2016, includes two NGL and olefinic liquids extraction plants located near Fort McMurray, Alberta, a fractionator near Redwater, Alberta and a 420 kilometre pipeline system that connects these facilities. Inter Pipeline also assumes responsibility for the potential construction of a $1.85 billion propane dehydrogenation facility located near the Redwater fractionator. This facility would convert low-cost, locally sourced propane into higher value polymer grade propylene, a petrochemical product primarily used in plastics manufacturing.
The Williams Canada acquisition was financed by the net proceeds from a $600 million subscription receipt offering which have now been released from escrow, $350 million of new term debt and the balance drawn under Inter Pipeline’s recently expanded $1,500 million committed revolving credit facility. In addition, Inter Pipeline intends to reinstate the premium dividend component of its Premium Dividend™ and Dividend Reinvestment Plan effective with the October 2016 dividend.
With the closing of the acquisition and in accordance with the terms of the subscription receipts, each outstanding subscription receipt of Inter Pipeline has been automatically exchanged, without payment of additional consideration, for one common share of Inter Pipeline and a dividend equivalent payment of $0.26 per subscription receipt in respect of the dividends declared by Inter Pipeline for August and September 2016. Holders of the subscription receipts are not required to take any action in order to receive the common shares and the dividend equivalent payment to which they are entitled. Inter Pipeline has been advised by the Toronto Stock Exchange (the “TSX”) that the subscription receipts will be de-listed from the TSX after close of trading on September 23, 2016.
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Inter Pipeline Ltd.
Inter Pipeline is a major petroleum transportation, natural gas liquids extraction, and bulk liquid storage business based in Calgary, Alberta, Canada. Inter Pipeline owns and operates energy infrastructure assets in western Canada and Europe. Inter Pipeline is a member of the S&P/TSX 60 Index and its common shares trade on the Toronto Stock Exchange under the symbol IPL. www.interpipeline.com