TORONTO - Brookfield Infrastructure Partners L.P. (NYSE: BIP) (TSX: BIP.UN), together with its institutional partners (collectively, 'Brookfield Infrastructure') and Inter Pipeline (TSX: IPL) are pleased to announce the expiry of the Offer.
Since the initial expiry time of the Offer, Brookfield Infrastructure has taken-up an incremental 33,087,736 Inter Pipeline common shares tendered under the Offer during the mandatory extension period. Upon payment for such Inter Pipeline common shares, Brookfield Infrastructure will increase its ownership of Inter Pipeline to 76.4%.
Final Results of Tender
Brookfield Infrastructure has taken up all Inter Pipeline common shares that were tendered under the Offer, including the incremental 33.1 million common shares that were tendered during the mandatory extension period. Based on the elections made by Inter Pipeline shareholders, Inter Pipeline shareholders will receive cash in respect of an aggregate of 27.5 million Inter Pipeline common shares and receive class A exchangeable subordinate voting shares of Brookfield Infrastructure Corporation ('BIPC Shares') or Exchangeable LP Units (as defined in the Offer) in respect of an aggregate of 5.6 million Inter Pipeline common shares. As shareholders elected to receive less BIPC Shares or Exchangeable LP Units than were available under the Offer, there was no proration.
Upon payment for the incremental Inter Pipeline common shares tendered before the expiry of the Offer, Brookfield Infrastructure will own 76.4% of Inter Pipeline's common shares. In aggregate across all take-up dates, holders of 95.0 million Inter Pipeline common shares elected BIPC Shares or Exchangeable LP Units representing 33.2% of the shares tendered under the Offer. Due to proration, a total of 22.0 million BIPC Shares or Exchangeable LP Units will be or have been issued to Inter Pipeline shareholders representing 30.7% of the Offer consideration.
Subsequent Acquisition Transaction
Immediately following the expiry of the Offer, Brookfield Infrastructure and Inter Pipeline entered into an arrangement agreement (the 'Arrangement Agreement') providing for a court-approved, statutory plan of arrangement under the Business Corporations Act (Alberta) (the 'Arrangement').
The Arrangement constitutes the Subsequent Acquisition Transaction contemplated in the Offer, by which Brookfield Infrastructure will acquire ownership of 100% of the Inter Pipeline common shares.
Under the terms of the Arrangement, holders of Inter Pipeline common shares, other than Brookfield Infrastructure, will be entitled to elect to receive the same per share consideration as set forth in the Offer, namely: C$20.00 in cash per Inter Pipeline common share; 0.250 of a BIPC share; or Any combination thereof
The entitlement of holders of Inter Pipeline common shares to receive BIPC Shares or Exchangeable LP Units will be subject to proration as described in the Arrangement.
As (i) Brookfield Infrastructure exercises control and direction over greater than 66 2/3% of the outstanding Inter Pipeline common shares and (ii) the Inter Pipeline common shares taken up under the Offer represent more than a majority of the votes attached to the Inter Pipeline common shares and may be voted in respect of any required 'minority' approvals , Brookfield Infrastructure is in a position to ensure the successful outcome of the shareholder votes in respect of the Subsequent Acquisition Transaction.
Additional information regarding the terms of the Arrangement Agreement, the Arrangement and the background of the transaction will be provided in the management information circular (the 'Circular') for the special meeting of Inter Pipeline shareholders to be held to consider the Arrangement. It is anticipated that the Circular will be mailed to Inter Pipeline shareholders in early October, with the Inter Pipeline special meeting, and closing of the Subsequent Acquisition Transaction, occurring in late October.
Cautionary Statement Regarding Forward-looking Statements
This news release may contain forward-looking information within the meaning of Canadian provincial securities laws and 'forward-looking statements' within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and in any applicable Canadian securities regulations. The words 'believe', 'expect', 'will' derivatives thereof and other expressions which are predictions of or indicate future events, trends or prospects and which do not relate to historical matters, identify the above mentioned and other forward-looking statements. Forward-looking statements in this news release include statements regarding the terms of the Subsequent Acquisition Transaction and the timing thereof and statements relating to Brookfield Infrastructure's intention to seek to delist the Inter Pipeline common shares.
Although Brookfield Infrastructure believes that these forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on them, or any other forward-looking statements or information in this news release. The actual outcome of future events could differ from the forward-looking statements and information herein, which are subject to a number of known and unknown risks and uncertainties. Factors that could cause actual events to differ materially from those contemplated or implied by the statements in this news release include the ability to obtain regulatory approvals (including approval of the TSX and the NYSE) and meet other closing conditions to any possible transaction, the ability to realize financial, operational and other benefits from the proposed transaction, general economic conditions in the jurisdictions in which we operate and elsewhere which may impact the markets for our products and services, the impact of market conditions on our businesses, the fact that success of Brookfield Infrastructure is dependent on market demand for an infrastructure company, which is unknown, the availability of equity and debt financing for Brookfield Infrastructure, the ability to effectively complete transactions in the competitive infrastructure space and to integrate acquisitions into existing operations, changes in technology which have the potential to disrupt the business and industries in which we invest, the market conditions of key commodities, the price, supply or demand for which can have a significant impact upon the financial and operating performance of our business and other risks and factors described in other documents filed by Brookfield Infrastructure with the securities regulators in Canada and the United States.
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