Enbridge Income Fund Holdings Inc.

May 04, 2011 08:48 ET

Enbridge Proposes $1.3 Billion Renewable Energy Transfer to Enbridge Income Fund

CALGARY, ALBERTA--(Marketwire - May 4, 2011) - Enbridge Income Fund Holdings Inc. (the "Company") (TSX:ENF) and Enbridge Income Fund (the "Fund") announced today receipt of a proposal from Enbridge Inc. ("Enbridge") (TSX:ENB) (NYSE:ENB), pursuant to which Enbridge would transfer three renewable energy assets to the Fund. The proposal contemplates that the Ontario Wind, Sarnia Solar and Talbot Wind energy projects would be transferred for an aggregate price of $1.3 billion, to be paid in part by the issuance of additional ordinary trust units of the Fund ("Units") to both the Company and Enbridge on a pro rata basis in accordance with their present holdings in the Fund. Under the proposal, Enbridge would provide bridge debt financing to the Fund for the balance of the price. Enbridge would also grant an option to the Company to acquire some or all of the Units to which Enbridge would be entitled to subscribe for. If exercised, the Company's economic interest in the Fund would increase.

The proposal contemplates that the Company would undertake a public equity offering to fund its subscription of Units and that Enbridge will concurrently subscribe for equity of the Company in order to maintain its current interest in the Company. It is expected that approximately $180 million will be required by the Company to subscribe for the Units, which would increase by up to an additional $70 million if the option granted by Enbridge described above is exercised in full. In the proposal, Enbridge estimates that based on certain assumptions, the after-tax earnings and cash flow of the Company may increase by approximately $0.07 per share on a sustainable basis.

The proposed transfer is subject to all necessary approvals, including the approval by the Boards of the Company and the Fund and regulatory approval. The Company and the Fund have formed a joint special committee comprised of independent trustees and directors, to review the proposal and make recommendations to the respective Boards of the Fund and the Company. Shareholders will be advised of next steps upon completion of this process.


Enbridge Income Fund Holdings Inc. ("EIFH") is a publicly traded corporation. EIFH holds an investment in Enbridge Income Fund (the "Fund"), a premier income fund in Canada with a low-risk profile focused on energy infrastructure assets. The Fund's assets include a 50% interest in the Canadian segment of the Alliance Pipeline, a 100% interest in the various pipelines comprising the Saskatchewan System, a 50% interest in each of NRGreen Limited Partnership and the Sunbridge wind project as well as a 33% interest in each of the Magrath and Chin Chute wind projects. Information about Enbridge Income Fund Holdings Inc. is available on the Company's website at www.enbridgeincomefund.com.

Certain information provided in this news release constitute forward-looking statements. Forward looking statements are typically identified by words such as "contemplate", "anticipate", "expect", "project", "estimate", "forecast" and similar words suggesting future outcomes or statements regarding an outlook. Although the Company believes that these statements are based on information and assumptions which are current, reasonable and complete, these statements and assumptions are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, weather, economic conditions and commodity prices. You can find a discussion of those risks and uncertainties in our Canadian securities filings. While the Company makes these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, including with respect to expected earnings and associated per share amounts, or estimated future dividends, may vary significantly from those expected. Readers are cautioned against placing undue reliance on forward-looking statements. Except as may be required by applicable securities laws, the Company assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

Contact Information