AltaGas Ltd. announces the completion of the initial public offering of AltaGas Canada Inc., which includes AltaGas' Canadian utilities and certain renewable power assets in Canada
AltaGas maintains a significant minority interest in AltaGas Canada Inc.
/NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
CALGARY, Oct. 25, 2018 /CNW/ -
- AltaGas Canada Inc. ("ACI") has successfully completed the initial public offering ("IPO") and sale of 16,500,000 common shares at $14.50 per common share (the "Offering Price") for gross proceeds of approximately $239 million.
- Total cash proceeds for AltaGas from the IPO are approximately $874 million1, which will be funded by ACI through the sale of 16,500,000 common shares and $635 million in debt.2
- Total cash proceeds for AltaGas could increase to approximately $910 million1 if the 2,475,000 common share over-allotment option is exercised in full.
- Following the IPO, AltaGas holds approximately 45 percent of ACI common shares, which could be reduced to approximately 36.7 percent if the over-allotment option is exercised in full.
- AltaGas has exceeded its $2.0 billion target on its asset monetization plan with respect to the repayment of its bridge facility, with approximately $2.4 billion raised.
- AltaGas has been rapidly repaying its bridge facility, and expects to repay its final commitment of approximately US $1.2 billion in the fourth quarter of 2018.
AltaGas Ltd. (AltaGas) (TSX: ALA) announced today that ACI has successfully completed the IPO and sale of 16,500,000 common shares of ACI at the Offering Price for aggregate gross proceeds of approximately $239 million. Total cash proceeds for AltaGas including the sale of ACI common shares to the public and $635 million in new debt issued at ACI is approximately $874 million1. Total cash proceeds for AltaGas could increase to $910 million1 if the 2,475,000 common share over-allotment option is exercised in full.
"The successful completion of this IPO marks the conclusion of our $2.0 billion asset monetization plan that we outlined earlier this year," said David Cornhill, Chairman and interim co-Chief Executive Officer of AltaGas. "We have moved swiftly since closing the WGL acquisition on July 6, 2018 to complete our asset monetization plan and pay down the bridge facility. We exceeded our initial asset monetization target and raised approximately $2.4 billion through this IPO and the previously announced sales of our non-core midstream and power assets in September and 35 percent interest in the Northwest Hydro Facilities in June."
The IPO was made through a syndicate of underwriters (the "Underwriters") jointly led by RBC Capital Markets, TD Securities Inc. and J.P. Morgan Securities Canada Inc.
The Toronto Stock Exchange ("TSX") approved the listing of the common shares of ACI under the symbol "ACI", and common shares of ACI are trading on the TSX.
The Underwriters have been granted an over-allotment option exercisable at the Underwriters' sole discretion, to purchase up to an additional 2,475,000 common shares (for a total 18,975,000 common shares if the over-allotment option is exercised in full) of ACI at the Offering Price, exercisable in whole or in part up to 30 days after closing of the IPO.
Following the IPO, AltaGas Ltd. holds a 45 percent interest in ACI. AltaGas Ltd. ownership would be reduced to approximately 36.7 percent if the Underwriters' over-allotment option is exercised in full.
No securities regulatory authority has either approved or disapproved of the contents of this press release. This press release is not for distribution, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia) or any other jurisdiction outside Canada. This press release does not constitute or form a part of any offer or solicitation to buy or sell any securities in the United States or any other jurisdiction outside of Canada. The securities offered pursuant to the amended and restated preliminary prospectus have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws. Accordingly, these securities may not be offered or sold within the United States or to a U.S. person unless registered under the U.S. Securities Act and applicable state securities laws or except pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws. There will be no public offering of securities in the United States.
AltaGas is an energy infrastructure company with a focus on natural gas, power and regulated utilities. AltaGas creates value by growing and optimizing its energy infrastructure, including a focus on clean energy sources. For more information visit: www.altagas.ca.
FORWARD LOOKING INFORMATION
This news release contains forward-looking information (forward-looking statements). Words such as "may", "can", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "aim", "seek", "propose", "contemplate", "estimate", "focus", "strive", "forecast", "expect", "project", "target", "potential", "objective", "continue", "outlook", "vision", "opportunity" and similar expressions suggesting future events or future performance, as they relate to AltaGas or any affiliate of the AltaGas, are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements with respect to, among other things, business objectives, expected growth, results of operations, performance, business projects and opportunities and financial results. Specifically, such forward-looking statements included in this document include, but are not limited to, statements with respect to the following: expected proceeds from the IPO and dependence on whether the over-allotment option is exercised; expected AltaGas ownership interest in ACI following the IPO; expected use of proceeds to repay debt; and expected timing of the repayment of the bridge facility.
AltaGas' forward-looking statements are subject to certain risks and uncertainties which could cause results or events to differ from current expectations, including, without limitation: access to and use of capital markets; market value of AltaGas' securities; AltaGas' ability to pay dividends; AltaGas' ability to service or refinance its debt and manage its credit rating and risk; prevailing economic conditions; potential litigation; AltaGas' relationships with external stakeholders, including Aboriginal stakeholders; volume throughput and the impacts of commodity pricing, supply, composition and other market risks; available electricity prices; interest rate, exchange rate and counterparty risks; legislative and regulatory environment; underinsured losses; weather, hydrology and climate changes; the potential for service interruptions; AltaGas' ability to economically and safely develop, contract and operate assets; AltaGas' ability to update infrastructure on a timely basis; AltaGas' dependence on certain partners; impacts of climate change and carbon taxing; effects of decommissioning, abandonment and reclamation costs; impact of labour relations and reliance on key personnel; cybersecurity risks; and risks associated with the underlying business of WGL. In particular, in this news release references to expected proceeds associated with the IPO are subject to a number of risks and uncertainties, including, without limitation, whether the over-allotment option is exercised in full, and other capital markets conditions prevailing until the over-allotment option expires. Applicable risk factors are discussed more fully under the heading "Risk Factors" in AltaGas' AIF for the year ended December 31, 2017.
Many factors could cause AltaGas' or any particular business segment's actual results, performance or achievements to vary from those described in this news release, including, without limitation, those listed above and the assumptions upon which they are based proving incorrect. These factors should not be construed as exhaustive. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this news release as intended, planned, anticipated, believed, sought, proposed, estimated, forecasted, expected, projected or targeted and such forward-looking statements included in this news release, should not be unduly relied upon. The impact of any one assumption, risk, uncertainty or other factor on a particular forward-looking statement cannot be determined with certainty because they are interdependent and AltaGas' future decisions and actions will depend on management's assessment of all information at the relevant time. Such statements speak only as of the date of this news release. AltaGas does not intend, and does not assume any obligation, to update these forward-looking statements except as required by law. The forward-looking statements contained in this news release are expressly qualified by these cautionary statements.
Financial outlook information contained in this news release about prospective financial performance, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this news release should not be used for purposes other than for which it is disclosed herein.
1 Proceeds are before the deduction of underwriting fees and expenses of ACI.
2 The $635 million in debt includes a new term debt issuance, intercompany loans and the assumption of existing indebtedness.
SOURCE AltaGas Ltd.