TC PipeLines, LP acknowledges TC Energy Corporation’s offer to acquire its outstanding common units
October 05 2020 - 6:50AM
TC PipeLines, LP (TCP) (NYSE: TCP) today announced that it has
received a non-binding offer from TC Energy Corporation (TC Energy)
(TSX, NYSE: TRP) to acquire all of the outstanding common units of
TCP not beneficially owned by TC Energy or its affiliates in
exchange for common shares of TC Energy. Under the proposal, TCP
common unitholders would receive 0.650 common shares of TC Energy
for each issued and outstanding publicly-held TCP common unit,
representing an implied value of US$27.31 per common unit based on
the closing price of TC Energy common shares on the New York Stock
Exchange (NYSE) on October 2, 2020. This reflects a 7.5 per cent
premium to the exchange ratio implied by the 20-day volume weighted
average prices of TCP’s common units and TC Energy’s common shares
on the NYSE as of October 2, 2020.
The offer has been made to the Board of
Directors of the general partner of TCP (the TCP Board). As the
general partner of TCP is an indirect wholly-owned subsidiary of TC
Energy, a Conflicts Committee composed of independent directors of
the TCP Board will be formed to consider the offer pursuant to its
processes.
The transaction is subject to the review and
favorable recommendation by the Conflicts Committee of the TCP
Board and approvals by the TCP Board, the Board of Directors of TC
Energy, and the holders of a majority of the outstanding common
units of TCP. It is also subject to the negotiation and execution
of an agreement and plan of merger, which would provide the
definitive terms of the transaction, including the exchange ratio,
and customary regulatory approvals. Any definitive agreement is
expected to contain customary closing conditions. There can be no
assurance that any such approvals will be forthcoming, that a
definitive agreement will be executed or that any transaction will
be consummated.
About TC PipeLines,
LP
TC PipeLines, LP is a Delaware master limited partnership with
interests in eight federally regulated U.S. interstate natural gas
pipelines which serve markets in the Western, Midwestern and
Northeastern United States. The Partnership is managed by its
general partner, TC PipeLines GP, Inc., a subsidiary of TC Energy
Corporation (NYSE: TRP). For more information about TC PipeLines,
LP, visit the Partnership’s website at www.tcpipelineslp.com.
Forward-Looking Statements
Certain non-historical statements in this
release relating to future plans, projections, events or conditions
are intended to be “forward-looking statements” including, but not
limited to, information with respect to a proposed transaction
between TCP and TC Energy. These statements are based on current
expectations and, therefore, subject to a variety of risks and
uncertainties that could cause actual results to differ materially
from the projections, anticipated results or other expectations
expressed in this release, including, without limitation to the
following: the negotiation and execution, and the terms and
conditions, of a definitive agreement relating to the proposed
transaction and the ability of TC Energy or TCP to enter into or
consummate such agreement; the risk that the proposed merger does
not occur; negative effects from the pendency of the proposed
merger; failure to obtain the required vote of TCP's unitholders or
board support; the timing to consummate the proposed transaction;
the focus of management time and attention on the proposed
transaction and other disruptions arising from the proposed
transaction; potential changes in the TC Energy share price which
may negatively impact the value of consideration offered to TCP
unitholders; general economic conditions, including the risk of a
prolonged economic slowdown or decline; the impact of downward
changes in oil and natural gas prices, including any effects on the
creditworthiness of our shippers or the availability of natural gas
in a low oil price environment, uncertainty surrounding the impact
of global health crises that reduce commercial and economic
activity, including the recent outbreak of the COVID-19 virus, and
the potential impact on our business and our ability to
access debt and equity markets that negatively impacts TCP’s
ability to finance its capital spending. These and other factors
that could cause future results to differ materially from those
anticipated are discussed in “Item 1A. Risk Factors” in our Annual
Report on Form 10-K for the year-ended December 31, 2019 filed with
the Securities and Exchange Commission (the SEC), as updated and
supplemented by subsequent filings with the SEC. All
forward-looking statements are made only as of the date made and
except as required by applicable law, we undertake no obligation to
update any forward-looking statements to reflect new information,
subsequent events or other changes.
Important Notice to
Investors
This news release is not a solicitation of a
proxy, an offer to purchase nor a solicitation of an offer to sell
common units of TCP, and it is not a substitute for any proxy
statement or other filings that may be made with the SEC should
this proposed transaction go forward. If such documents are filed
with the SEC, investors will be urged to thoroughly review and
consider them because they will contain important information,
including risk factors. Any such documents, once filed, will be
available free of charge at the SEC’s website (www.sec.gov) and
from TCP.
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Media
Inquiries:
Jaimie Harding 403.920.7859 or 800.608.7859
Unitholder and Analyst Inquiries:
Rhonda Amundson
877.290.2772
investor_relations@tcpipelineslp.com
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