Pembina Pipeline Corporation announced that Pembina and Inter Pipeline Ltd. have filed cross-applications with the Alberta Securities Commission (the “ASC“) to remedy disclosure issues and coercive tactics by Brookfield Infrastructure Partners L.P. and its affiliates (collectively, “Brookfield“) in relation to its inferior hostile take-over offer of Inter Pipeline (the “Take-Over Offer“).
Pembina’s President and Chief Executive Officer Mick Dilger added: “It is critically important that all shareholders involved in a large transaction be given transparency and a fair, unencumbered process to choose the deal that they determine to be in their best interests. This is equally important for sophisticated investors and individual retail holders. Brookfield cannot use its ‘block’ of shares to threaten the strategic merger with Pembina, while at the same time claiming that it does not control these shares and that they count toward acceptance of its tender offer. Brookfield is clearly conflicted and must step back and let Inter Pipeline’s other shareholders choose the best offer.”
Added Dilger, “Brookfield is pushing the same offer that has essentially been repackaged three times while trying to unfairly influence a democratic process to have that inferior transaction accepted. We are asking the ASC to bring some daylight into the process and protect shareholder rights.”
The Inter Pipeline Board has unanimously recommended that shareholders support the strategic share-exchange transaction with Pembina (the “Strategic Combination“). In addition to greater immediate value, the Strategic Combination will give Inter Pipeline shareholders an immediate 175% increase to their monthly dividend, significant upside value due to the combined companies’ synergies and accelerated growth outlook, and a tax-free rollover for taxable Canadian shareholders.
Summary of the Cross-Applications
In its June 18, 2021, cross-applications to the ASC, Inter Pipeline explained how Brookfield has used opaque and unidentified financial contracts that avoid early warning obligations, build a “block” to prevent Inter Pipeline shareholders from approving the superior Strategic Combination, and circumvent the minimum tender requirements of their own Take-Over Offer:
To ensure that Brookfield does not continue to use the Total Return Swap in a manner that harms Inter Pipeline shareholders and the capital market, Inter Pipeline is seeking relief from the ASC pursuant to the Securities Act (Alberta), including orders that:
In its cross-application to the ASC, Pembina joined Inter Pipeline, adopting the entirety of its cross-application. In addition, Pembina seeks a cease trade order with respect to any securities issued or exchanged in connection with Brookfield’s Take-Over Offer.
Pembina seeks all of this relief to ensure fairness and to allow Inter Pipeline shareholders to make their own choice.
Pembina is a leading transportation and midstream service provider that has been serving North America’s energy industry for more than 65 years. Pembina owns an integrated system of pipelines that transport various hydrocarbon liquids and natural gas products produced primarily in western Canada. Pembina also owns gas gathering and processing facilities; an oil and natural gas liquids infrastructure and logistics business; and is growing an export terminals business. Pembina’s integrated assets and commercial operations along the majority of the hydrocarbon value chain allow it to offer a full spectrum of midstream and marketing services to the energy sector. Pembina is committed to identifying additional opportunities to connect hydrocarbon production to new demand locations through the development of infrastructure that would extend Pembina’s service offering even further along the hydrocarbon value chain. These new developments will contribute to ensuring that hydrocarbons produced in the Western Canadian Sedimentary Basin and the other basins where Pembina operates can reach the highest value markets throughout the world.
Purpose of Pembina:
To be the leader in delivering integrated infrastructure solutions connecting global markets:
Pembina is structured into three Divisions: Pipelines Division, Facilities Division and Marketing & New Ventures Division.
Pembina’s common shares trade on the Toronto and New York stock exchanges under PPL and PBA, respectively. For more information, visit www.pembina.com.