Spectra Energy bought by Enbridge in $28 billion deal

HOUSTON- Canadian pipeline company Enbridge Inc., said Monday it would acquire Houston-based Spectra Energy in a $28 billion all-stock deal.

The merger would create North America's largest energy infrastructure company, valued at $127 billion, when it is completed in the first quarter of 2017, the companies said.

Spectra Energy shareholders will get 0.984 shares of the merged company for each Spectra share, which are valued at $40.33, a premium of about 11.5% over Spectra's closing price on Sept. 2. Upon the merger's completion, Enbridge shareholders will own about 57% of the company, with Spectra shareholders holding 43%.

Shares of Spectra Energy (SE) were up more than 14% in midday trading Monday to $41.34. Enbridge shares (ENB) were up 5.5% to $43.25.

Enbridge, headquartered in Calgary, Alberta, operates the world's longest crude oil pipeline system across Canada and the U.S. The merger gains Spectra Energy's about 21,000 miles of oil and gas pipelines. "This transaction is transformational for both companies and results in unmatched scale, diversity and financial flexibility with multiple platforms for organic growth," said Enbridge CEO and President Al Monaco in a statement.

Monaco will serve as the combined company's CEO and president, while Spectra CEO and President Greg Ebel will serve as non-executive chairman of Enbridge's Board of Directors.

USA TODAY


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