Enbridge Income Fund
TSX : ENF

Enbridge Income Fund

March 31, 2015 19:21 ET

Enbridge Income Fund Receives Proposal for Transfer of Canadian Liquids Pipeline Business and Renewable Energy Assets from Enbridge

CALGARY, ALBERTA--(Marketwired - March 31, 2015) - Enbridge Income Fund (the Fund) and Enbridge Income Fund Holdings Inc. (TSX:ENF) (the Company) today announced receipt of a formal proposal from Enbridge Inc. (Enbridge) for the transfer to the Fund (the Transaction) of Enbridge's Canadian liquids pipelines business owned by Enbridge Pipelines Inc. and Enbridge Pipelines (Athabasca) Inc., along with certain Canadian renewable energy assets (collectively, the "Assets").

If completed, the Transaction would be transformational for the Fund, significantly increasing its business scale and scope as well as providing a highly transparent source of long-term growth. Based on Enbridge's financial assumptions and projections, the Company's dividend could be increased by approximately 10% on closing of the Transaction and by a further 10% in 2016 and each year thereafter through 2019. Dividend growth subsequent to the Transaction is expected to be driven by a combination of the substantial organic growth within the liquids pipelines business and by the Company increasing its ownership in the Fund over time.

"This is an important step forward for a transaction that will transform the Fund into a premier Canadian energy infrastructure investment vehicle," said Perry Schuldhaus, the Company's president. "The Assets will add to an already strong and diversified asset base and provide the Fund with a substantial and visible source of future growth in earnings and distributions," added Mr. Schuldhaus.

The Transaction is progressing according to the timeline disclosed in Enbridge's December 3, 2014 news release. Closing of the Transaction is subject to obtaining all necessary approvals, including the approval by the Boards of the Company and Enbridge Commercial Trust (collectively, the "Boards"), the approval of the shareholders of the Company and regulatory approvals. The Boards have formed a joint special committee (the "Special Committee") comprised of independent directors of the Company and independent trustees of Enbridge Commercial Trust to review and consider the proposal from Enbridge and negotiate the terms and conditions of the definitive agreement. The Special Committee has retained independent financial, legal, technical and market fundamentals advisors to assess the Transaction. BMO Capital Markets has been retained to act as financial advisor to the Special Committee and to deliver a formal valuation of the Assets and an opinion as to whether the consideration to be paid for the Assets is fair, from a financial point of view, to the Fund, Enbridge Commercial Trust, the Company and the shareholders of the Company, other than Enbridge.

Further details of Enbridge's Canadian restructuring plan and the Assets can be found in Enbridge's December 3, 2014 news release.

ABOUT ENBRIDGE INCOME FUND HOLDINGS INC.

Enbridge Income Fund Holdings Inc. is a publicly traded corporation. The Company, through its investment in Enbridge Income Fund, holds high quality, low risk energy infrastructure assets. The Fund's assets include interests in more than 500 megawatts of renewable and alternative power generation capacity, a portfolio of liquids transportation and storage businesses including Class A Units entitling the holder to cash flows derived from the Southern Lights Pipeline and a 50 per cent interest in the Alliance Pipeline. Information about Enbridge Income Fund Holdings Inc. is available on the Company's website at www.enbridgeincomefund.com.

FORWARD-LOOKING INFORMATION

Forward-looking information, or forward-looking statements, have been included in this news release to provide the Company's shareholders and potential investors in the Fund and the Company with information about the Company, the Fund, the Fund's subsidiaries and affiliates, including management's assessment of the Company, the Fund and the Fund's subsidiaries' future plans and operations. This information may not be appropriate for other purposes. Forward-looking statements are typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe" and similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information or statements included or incorporated by reference in this document include, but are not limited to, statements with respect to: expectations regarding the proposed transaction including the negotiation of definitive terms, satisfaction of conditions, the obtaining of required consents and approvals, expected timing and completion of the proposed transaction; the effect, results and perceived benefits of the proposed transaction to the Company and the Fund; future equity investments in the Fund by the Company; and dividend payout by the Company.

Although the Company and the Fund believe that these forward-looking statements are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Material assumptions include assumptions about: expected timing and terms of the proposed transaction; completion of the proposed transaction; receipt of regulatory, shareholder and third party consents and approvals; impact of the proposed transaction; future capital growth programs; future cash flows; credit ratings of the Fund; expected earnings/(loss) or adjusted earnings/(loss); expected earnings/(loss) or adjusted earnings/(loss) per share or unit, as applicable; increases in distributions and dividends; expected market conditions; and the ability of the Company and the Fund to access capital markets on favourable terms or at all.

All forward-looking statements are subject to risks and uncertainties pertaining to the proposed transaction, dividend payout, adjusted earnings guidance, operating performance, regulatory parameters, project approval and support, weather, economic and competitive conditions, changes in tax law and tax rates, exchange rates, interest rates, commodity prices and supply and demand for commodities, including but not limited to those risks and uncertainties discussed in this news release and in the other filings with securities regulators by the Company and the Fund. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as these are interdependent and the future course of action depends on management's assessment of all information available at the relevant time. Except to the extent required by applicable law, neither the Company nor the Fund assumes any obligation to publicly update or revise any forward-looking statements made in this news release or otherwise, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements, whether written or oral, attributable to the Company or the Fund or persons acting on their behalf, are expressly qualified in their entirety by these cautionary statements.

Readers should be cautioned that there is no assurance that the proposed transaction will be completed in the manner contemplated, or at all, or that the current market conditions and the assumptions and forecasts by Enbridge, the Company and the Fund based on such market conditions will not materially change.

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