Pembina Pipeline Corp. terminated the proposed business combination with Inter Pipeline Ltd. after Inter Pipeline said its board of directors would not reconfirm a recommendation that shareholders vote in favor of the deal.
On May 31, the companies noted the proposed share-for-share transaction valued at $8.3 billion (Can.) that would have created one of the largest energy infrastructure companies in Canada (OGJ Online, June 1, 2021).
Brookfield Infrastructure Partners proposed multiple takeover offers for Inter Pipeline in an effort to top Pembina Pipeline (OGJ Online, June 7, 2021). On July 19, an affiliate of Brookfield made a revised offer with consideration, at the election of Inter Pipeline shareholders, of either $20.00 in cash or 0.25 of a Brookfield Infrastructure class A exchangeable subordinate voting share for each Inter Pipeline share, subject to proration.
In a statement July 26, Inter Pipeline said its board of directors “is open to engaging with Brookfield in an effort to reach a mutually agreeable transaction in the best interests of shareholders,” and that the company will be in a position to make a formal recommendation on the revised Brookfield offer in due course.
Inter Pipeline has agreed to pay Pembina a $350 million (Can.) termination fee.
