Enbridge Inc. and Enbridge Pipelines Inc. Launch Debt Exchange Proposal for Medium Term Notes
Enbridge Inc. and its wholly owned subsidiary Enbridge Pipelines Inc. (EPI) have announced a major debt exchange proposal aimed at restructuring EPI’s outstanding medium term note debentures while enhancing operational and financial flexibility across the organization. The initiative is designed to simplify the company’s debt structure and align the notes directly under Enbridge’s existing senior unsecured debt platform.
Under the proposed transaction, holders of all outstanding series of EPI medium term note debentures will be asked to approve an exchange of their existing EPI Notes for an equal principal amount of newly issued Enbridge Notes. The replacement securities will carry financial terms identical to those currently attached to the EPI Notes, ensuring continuity for investors while transferring the obligations to Enbridge itself.
The newly issued Enbridge Notes will be governed by Enbridge’s established medium term note trust indenture originally dated October 20, 1997, including all subsequent amendments and supplements. This trust indenture already governs Enbridge’s senior Canadian dollar unsecured debt securities and provides the framework for the company’s broader debt issuance activities.
The proposed Note Exchange Transaction represents a strategic move by Enbridge and EPI to streamline their capital structure while providing EPI with greater flexibility to manage and operate its business. Company officials indicated that the transaction is expected to deliver operational, structural, and capital markets advantages not only for the two entities involved but also for the existing EPI noteholders.
According to the companies, the exchange will allow EPI to simplify its debt obligations by consolidating them under the parent company’s debt framework. Enbridge believes this approach can improve efficiency in capital markets activities and support long-term financial management objectives.
To complete the transaction, EPI is seeking approval from holders of all outstanding series of eligible EPI Notes through a consent solicitation and proxy process. All EPI noteholders will vote as a single class on an extraordinary resolution known as the Note Exchange Resolution.
The deadline for submitting written consents has been established as 5:00 p.m. Toronto time on June 10, 2026, although EPI retains the right to extend this deadline at its discretion. Additionally, the deadline for submitting proxies for the planned noteholder meeting is set for 12:00 p.m. Toronto time on June 23, 2026, unless the meeting is postponed or adjourned.
If holders representing at least 75% of the aggregate principal amount of the EPI Notes provide valid written consents approving the transaction before the consent deadline, the resolution will be deemed approved without the need for a formal meeting. In such a scenario, the scheduled meeting of EPI noteholders, currently planned for June 25, 2026, in Calgary, Alberta, would be cancelled.
The proposal covers multiple series of EPI Notes spanning maturities from 2027 through 2053. These notes carry coupon rates ranging from 2.82% to 6.55%, reflecting varying issuance periods and market conditions at the time the securities were originally offered.
Among the shorter-dated securities eligible for exchange are the 6.55% notes maturing on November 17, 2027, the 6.05% notes due February 12, 2029, the 3.52% notes due February 22, 2029, and the 6.50% notes maturing June 11, 2029.
The transaction also includes longer-term debt instruments such as the 2.82% notes due in 2031, the 5.08% notes due in 2036, and the 5.35% and 5.33% series maturing in 2039 and 2040 respectively.
Further included are several ultra-long-term securities extending into the 2040s and 2050s. These include 4.55% notes maturing in both 2043 and 2045, 4.13% notes due in 2046, 4.33% notes due in 2049, 4.20% notes maturing in 2051, and 5.82% notes scheduled to mature in 2053.
As part of the consent solicitation process, EPI noteholders who validly submit written consents and proxies before the applicable deadlines will be eligible to receive Amendment Review Fees if the resolution is approved. The fees vary depending on the maturity profile of the notes involved.
For shorter-term notes maturing between 2027 and 2029, investors will receive amendment review fees of $1.50 per $1,000 principal amount. Mid-range notes such as those maturing in 2031, 2036, 2039, and 2040 will qualify for fees of $3.50 per $1,000 principal amount.
Meanwhile, holders of the longest-dated securities maturing between 2043 and 2053 will receive amendment review fees of $5.00 per $1,000 principal amount. No fees will be paid unless the Note Exchange Resolution receives the necessary approval.
The record date for determining which EPI noteholders are entitled to vote on the proposal was set at the close of business on May 20, 2026.
EPI emphasized that it reserves the right to extend or modify the consent deadline at any time. The company also noted that if the required 75% approval threshold is reached prior to the proxy deadline, the formal meeting could be cancelled with minimal notice to investors. As a result, noteholders are being encouraged to submit their elections as early as possible to ensure eligibility for the amendment review fees.
Several financial and advisory firms have been retained to support the transaction process. BMO Nesbitt Burns Inc., operating as BMO Capital Markets, is serving as the solicitation agent for the exchange proposal.
Computershare Investor Services Inc. has been appointed as tabulation agent responsible for processing consents and proxies, while Sodali & Co. is acting as information agent for the transaction.
The companies stated that copies of the management information circular and all related consent solicitation documents are available through EPI’s profile on the Canadian securities filing platform SEDAR+. Investors may also obtain materials directly through Sodali & Co. or by contacting Enbridge’s investor relations department.
The announcement also included an important notice for noteholders located in the United States. The Enbridge Notes being issued through the exchange transaction have not been registered under the U.S. Securities Act of 1933. Instead, the securities are being issued pursuant to an exemption from registration requirements under Rule 802 of the Act.
Enbridge and EPI cautioned U.S. investors that the transaction is governed primarily by Canadian disclosure standards and regulations, which differ from those applicable in the United States. The companies further noted that U.S. investors may face challenges enforcing rights or claims under U.S. federal securities laws because both companies are based in Canada and many directors and officers reside there.
In addition, the companies advised that prior to completion of the transaction, Enbridge, EPI, or their affiliates may directly or indirectly purchase EPI Notes or related securities where permitted under applicable Canadian and U.S. laws and regulations.
The proposed debt exchange reflects Enbridge’s broader strategy of optimizing its financial structure while maintaining strong access to capital markets. By consolidating debt obligations at the parent company level, Enbridge aims to strengthen financial efficiency and create a more streamlined framework for future financing activities.
For investors, the transaction offers continuity in financial terms while potentially benefiting from the credit profile and broader market presence associated with Enbridge’s existing senior unsecured debt program. The outcome of the vote in June will determine whether the exchange proceeds as planned and whether EPI’s outstanding notes officially transition into direct obligations of Enbridge.
Source Link: https://www.enbridge.com/
