Pembina Pipeline to Acquire Kinder Morgan Entities for $3.27 Billion
August 21 2019 - 7:00AM
Dow Jones News
By Dave Sebastian
Pembina Pipeline Corp. (PBA, PPL.T) said Wednesday it has agreed
to acquire Kinder Morgan Canada Ltd. (KML.T) and the U.S. portion
of the Cochin pipeline system from Kinder Morgan Inc. (KMI).
Pembina values the deals at C$4.35 billion ($3.27 billion),
including debt.
The Canadian pipeline-transport company said it will acquire the
U.S. portion of the Cochin pipeline, which spans from Chicago to
Fort Saskatchewan, Alberta, for $1.55 billion in cash, which
Pembina values at C$2.05 billion.
Pembina said it would acquire Kinder Morgan Canada for C$2.3
billion including Kinder Morgan Canada's preferred shares and
outstanding net debt.
Pembina said it would issue 0.3068 of its common shares for each
outstanding restricted-voting share and class B unit of Kinder
Morgan Canada. The exchange ratio represents a 32% premium over
Pembina and Kinder Morgan Canada's 30-day volume-weighted average
prices of C$48.96 and C$11.37, respectively, Pembina said.
The deals would add to Pembina's adjusted cash flow per share as
well as increase the company's fee-for-service and take-or-pay
component of adjusted earnings before interest, taxes, depreciation
and amortization.
Pembina said its board of directors approved an increase of a
penny a share, or about 5%, to its monthly dividend rate, subject
to the closing of the transaction.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
August 21, 2019 07:45 ET (11:45 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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