DBRS Rates Enbridge Inc.’s Preferred Share Issue at Pfd-2 (low), Stable Trend

DBRS has today assigned a rating of Pfd-2 (low) with a Stable trend to Enbridge Inc.’s (Enbridge or the Company) CAD 500 million cumulative redeemable preference shares, Series 11 (the Series 11 Preferred Shares), which have a dividend rate of 4.4% per annum, payable quarterly for the initial fixed-term period ending March 1, 2020. The dividend rate will reset on March 1, 2020, and on March 1 every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield plus 2.64%. The Series 11 Preferred Shares are redeemable by Enbridge on March 1, 2020, and on March 1 of every fifth year thereafter.

Holders of the Series 11 Preferred Shares will have the right, at their option, to convert their shares into cumulative redeemable preference shares, Series 12 (the Series 12 Preferred Shares), subject to certain conditions, on March 1, 2020, and on March 1 every five years thereafter. Holders of the Series 12 Preferred Shares will be entitled to receive cumulative quarterly dividends at a rate equal to the sum of the then 90-day Government of Canada Treasury Bill rate plus 2.64%.

The Series 11 Preferred Shares were issued under a prospectus supplement dated May 14, 2014, to the short form base shelf prospectus dated June 6, 2013, and are expected to close on May 22, 2014. The Series 11 Preferred Shares rank equally with all outstanding cumulative redeemable preferred shares issued by the Company. Net proceeds from the offering will be used to partially fund Enbridge’s capital projects, to reduce existing indebtedness and for general corporate purposes.

Notes:
The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The applicable methodology is Rating Pipeline and Diversified Energy Companies (January 2014), which can be found on our website under Methodologies.

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