CALGARY, AB, July 26, 2021 /CNW/ – Inter Pipeline Ltd. (“Inter Pipeline” or the “Company”) (TSX: IPL) today announced that it has advised Pembina Pipeline Corporation (“Pembina”) that Inter Pipeline’s Board of Directors will not be reconfirming its recommendation that shareholders of the Company vote in favour of the Pembina Arrangement (as defined below). As a result, Pembina has terminated the Arrangement Agreement (as defined below) effective July 25, 2021 and Inter Pipeline has agreed to pay Pembina the termination fee of $350 million.
On May 31, 2021, Inter Pipeline entered into an agreement (the “Arrangement Agreement”) to pursue a business combination with Pembina, whereby Pembina agreed to acquire all the issued and outstanding Inter Pipeline common shares pursuant to a plan of arrangement (the “Pembina Arrangement”). Inter Pipeline shareholders would have received 0.5 of a common share of Pembina for each Inter Pipeline common share they own under the Pembina Arrangement.
On July 19, 2021, an affiliate of Brookfield Infrastructure Partners L.P. (“Brookfield”) made a revised offer with consideration, at the election of Inter Pipeline shareholders, of either (i) $20.00 in cash or (ii) 0.25 of a Brookfield Infrastructure Corporation class A exchangeable subordinate voting share (“BIPC Share”) for each Inter Pipeline share, subject to proration in the case of the BIPC Shares (the “Revised Brookfield Offer”).
Inter Pipeline’s Board of Directors is open to engaging with Brookfield in an effort to reach a mutually agreeable transaction in the best interests of shareholders. Inter Pipeline will be in a position to make a formal recommendation on the Revised Brookfield Offer in due course.
Annual Meeting of Inter Pipeline Shareholders
The virtual-only 2021 annual meeting of shareholders of the Company will continue to be held on July 29, 2021 at 10:00 a.m. (MT) (the “Meeting”) to consider and vote on the matters set forth in the notice of the Meeting dated June 29, except approval of the Pembina Arrangement which will be withdrawn. The proxy submission deadline for the Meeting is 10:00 a.m. (MT) on July 27, 2021, or 48 hours (excluding Saturdays, Sundays and statutory holidays in the Province of Alberta) prior to the time of any adjournment or postponement of the Meeting.
Financial and Legal Advisors
Inter Pipeline has retained TD Securities Inc. and the Special Committee has retained J.P. Morgan Securities Canada Inc. as financial advisors. Burnet, Duckworth & Palmer LLP and Dentons Canada LLP are acting as legal advisors to Inter Pipeline and its Board of Directors.
If you have questions please contact Inter Pipeline’s proxy solicitation agent, Kingsdale Advisors by telephone at 1-877-659-1820 (416-867-2272 for collect calls outside North America) or by email at firstname.lastname@example.org.
About Inter Pipeline Ltd.
Inter Pipeline is a major petroleum transportation and natural gas liquids processing business based in Calgary, Alberta, Canada. Inter Pipeline owns and operates energy infrastructure assets in Western Canada and is building the Heartland Petrochemical Complex — North America’s first integrated propane dehydrogenation and polypropylene facility. 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
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Certain information contained herein may constitute forward-looking statements that involve risks and uncertainties. Readers are cautioned not to place undue reliance on forward-looking statements, including, but not limited to, statements regarding the agreement to pay the termination fee to Pembina and the timing for the Meeting and the matters to be considered at the Meeting. Factors that could cause actual results to vary from forward-looking statements or may affect the operations, performance, development and results of Inter Pipeline’s businesses include, among other things, the risks and assumptions associated with operations, including: the further development of its projects and facilities; assumptions concerning operational reliability; the potential delays of and increased costs of construction projects (including the Heartland Petrochemical Complex) and future expansions of Inter Pipeline’s assets; the realization of the anticipated benefits of acquisitions and other projects Inter Pipeline is developing; the timing, financing and completion of acquisitions, transactions or other projects Inter Pipeline is pursuing; risks inherent in Inter Pipeline’s Canadian and foreign operations; risks associated with the failure to finalize formal agreements with counterparties in circumstances where letters of intent or similar agreements have been executed and announced by Inter Pipeline; Inter Pipeline’s ability to generate sufficient cash flow from operations to meet its current and future obligations; Inter Pipeline’s ability to maintain its current level of cash dividends to its shareholders; Inter Pipeline’s ability to access sources of debt and equity capital; Inter Pipeline’s ability to make capital investments and the amounts of capital investments; Inter Pipeline’s ability to maintain its credit ratings; the availability and price of labour, equipment and construction materials; the status, credit risk and continued existence of counterparties having contracts with Inter Pipeline and its affiliates and their performance of such contracts; competitive factors, pricing pressures and supply and demand in the oil and gas transportation, natural gas liquids processing and bulk liquid storage industries; increases in maintenance, operating or financing costs; availability of adequate levels of insurance; difficulty in obtaining necessary regulatory approvals or land access rights and maintenance of support of such approvals and rights; risks of war, hostilities, civil insurrection, instability and political and economic conditions in or affecting countries in which Inter Pipeline and its affiliates operate; severe weather conditions and risks related to climate change; terrorist threats; risks associated with technology and cyber security; availability of energy commodities; volatility of and assumptions regarding prices of energy commodities; fluctuations in currency and interest rates; changes in laws and regulations, including environmental, regulatory and taxation laws, and the interpretation of such changes to Inter Pipeline’s business; the risks associated with existing and potential or threatened future lawsuits and regulatory actions against Inter Pipeline and its affiliates; general economic and business conditions; the effects and impacts of the COVID-19 pandemic as further described in Inter Pipeline’s reports and filings, the extent and duration of which are uncertain at this time, on Inter Pipeline’s business and general economic and business conditions and markets, and such other risk factors, assumptions and uncertainties described from time to time in Inter Pipeline’s reports and filings with the Canadian securities regulatory authorities including in Inter Pipeline’s most recent MD&A and Annual Information Form, and other documents it files from time to time. You can find these documents by referring to Inter Pipeline’s profile on SEDAR (www.sedar.com). Such information, although considered reasonable by Inter Pipeline at the time of preparation, may later prove to be incorrect and actual results may differ materially from those anticipated in the statements made. For this purpose, any statements that are not statements of historical fact are deemed to be forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release, and, except to the extent required by applicable law, Inter Pipeline assumes no obligation to update or revise forward-looking statements made herein or otherwise, whether as a result of new information, future events, or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary note.
All dollar values are expressed in Canadian dollars unless otherwise noted.
SOURCE Inter Pipeline Ltd.