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MarketScreener Homepage  >  Equities  >  Toronto Stock Exchange  >  Enbridge Inc.    ENB   CA29250N1050


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Enbridge hits debt target with $2.5 billion pipeline, renewables sale

05/09/2018 | 06:12pm EST
FILE PHOTO: Pipelines run to Enbridge Inc.'s crude oil storage tanks at their tank farm in Cushing

(Reuters) - Enbridge Inc will sell a U.S. gas pipelines business and part of its renewable energy portfolio for a combined $2.5 billion (1.84 billion pounds), the Canadian pipeline operator said on Wednesday, achieving the first step in its debt reduction plan.

The Calgary-based company is continuing to shop its Canadian midstream assets and has received initial bids valuing the portfolio as high as C$4.5 billion ($3.5 billion), people familiar with the situation told Reuters.

Enbridge Chief Executive Officer Al Monaco told reporters on Wednesday that the company has not received any formal bids for the Canadian midstream assets and declined to comment on indications of interest.

Enbridge has been under pressure to sell non-core assets since its $28 billion takeover of U.S.-based Spectra Energy last year. Its long-term debt pile of $60.87 billion as of Dec. 31 has also caused alarm at credit rating agencies. [http://bit.ly/2EwyF5O]

The company said in November it expected to raise upwards of C$3 billion from divestments in 2018, the first sales from a pool of non-core assets worth C$10 billion.

The deals announced on Wednesday brought Enbridge close to that goal. The company said it had sealed a C$1.75 billion deal with the Canada Pension Plan Investment Board (CPPIB) for a 49 percent stake in wind and solar power assets in North America and Germany.

The company will also sell Midcoast Operating LP, its U.S. gas pipelines unit, to an affiliate of private equity firm ArcLight Capital Partners LLC for $1.12 billion. Midcoast operates facilities to process and treat natural gas and natural gas liquids.

"This transaction, in addition to our other funding actions taken, accelerates funding for our secured capital program and gives us increased financial flexibility," Monaco said in a statement announcing the CPPIB deal.

Enbridge said it may yet monetize or sell the remaining renewable stake. Banking sources suggested that Enbridge had offered all its renewables assets for sale to begin with, asking potential buyers to propose the best deal.

The company separately said Wednesday that it had filed a formal response to a Minnesota judge's recommendation that its Line 3 pipeline replacement go ahead but follow the existing right-of-way through the state instead of Enbridge's preferred route.

Enbridge said that if it were to follow the recommended route, the existing pipeline would need to be shut down for nine to 12 months, "negatively impacting Minnesota's energy supply."

The C$8.2 billion Line 3 replacement would double capacity on the pipeline, which extends from Alberta to Wisconsin, providing much needed relief to Canada's oil producers who are struggling with a lack of transportation capacity to get their crude to market.


In an interview with Reuters, Bruce Hogg, head of power and renewables at CPPIB, said its longstanding history with Enbridge and the fund's desire to grow its renewables exposure led to the agreement.

"We were having conversations about a broader arrangement and the ability to grow value over time, which was a much more sellable package (to Enbridge) than they initially envisaged," he said.

The pension fund will also provide C$500 million of capital to help finance outstanding construction related to the German offshore wind scheme, and it signed a 50-50 joint venture with Enbridge to invest in future European offshore wind projects.

CPPIB also purchased U.S. utility NextEra Energy Partners' wind and solar assets in Ontario last month for about $582 million.

CIBC Capital Markets and law firm Dentons advised Enbridge on the renewables deal, the statement said. RBC Capital Markets and Citigroup advised CPPIB, sources familiar with the matter said. Citi, along with Norton Rose Fulbright LLP, worked with Enbridge on the U.S. midstream sale.

Enbridge's Toronto shares closed up 2.65 percent at C$41.48.

(Reporting by Anirban Paul in Bengaluru, David French in New York and John Tilak in Toronto, Additional reporting by Rod Nickel in Calgary and Julie Gordon in Vancouver; Editing by David Gregorio, Sai Sachin Ravikumar and Cynthia Osterman)

By Anirban Paul, David French and John Tilak

© Reuters 2018
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Sales 2020 39 296 M 30 934 M 30 934 M
Net income 2020 2 525 M 1 988 M 1 988 M
Net Debt 2020 72 051 M 56 718 M 56 718 M
P/E ratio 2020 37,1x
Yield 2020 7,24%
Capitalization 90 629 M 71 148 M 71 343 M
EV / Sales 2020 4,14x
EV / Sales 2021 4,24x
Nbr of Employees 13 000
Free-Float 86,4%
Duration : Period :
Enbridge Inc. Technical Analysis Chart | MarketScreener
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Technical analysis trends ENBRIDGE INC.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus BUY
Number of Analysts 26
Average target price 51,37 CAD
Last Close Price 44,75 CAD
Spread / Highest target 29,6%
Spread / Average Target 14,8%
Spread / Lowest Target -21,8%
EPS Revisions
Managers and Directors
Albert Monaco President, CEO & Non-Independent Director
Gregory Lorne Ebel Non-Executive Chairman
Colin K. Gruending Chief Financial Officer & Executive Vice President
Bhushan Ivaturi Chief Information Officer & Senior Vice President
Vera Maureen Kempston-Darkes Independent Director
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