Enbridge and Spectra Energy are set to merge to combine to create a US$127 billion (£94.96 billion) energy infrastructure company.
The two companies entered a merger agreement today under which they will combine in a stock-for-stock merger transaction, in a deal valued at US$28 billion (£20.9 billion).
“The combination will create the largest energy infrastructure company in North America and one of the largest globally,” the companies informed in a statement.
Energy Giant Created In $127Bn Spectra Enbridge Merger
The combined company will be called Enbridge Inc. and will count on an asset base made up of “a diverse set of best-in-class assets comprised of crude oil, liquids and natural gas pipelines, terminal and midstream operations, a regulated utility portfolio and renewable power generation,” the companies explained.
According to the President and CEO of Enbridge Inc, Al Monaco, the acquisition follows Enbridge’s attempt to identify new opportunities to extend its asset base and sources of growth beyond 2019.
“We are accomplishing that goal by combining with the premier natural gas infrastructure company to create a true North American and global energy infrastructure leader. This Transaction is transformational for both companies and results in unmatched scale, diversity and financial flexibility with multiple platforms for organic growth,” he explained.
The executive explained that the combined business will count on US$20 billion (£14.9 billion) in secured projects in execution and US$37 billion (£27.66 billion) of projects under development.
Creating the Most Diversified Energy Company in the World
The President and CEO of Spectra Energy, Greg Ebel, who will become the chairman of Enbridge after the closing of the transaction, considers the result of this merger to be “the best, most diversified energy infrastructure company in North America, if not in the world”.
“Together, the merged company will have what we believe is the finest platform for serving customers in every region of North America and providing investors with the opportunity for superior shareholder returns,” he said.