CALGARY, ALBERTA--November 26, 2001
Enbridge Inc. has agreed in principle to acquire a 25 percent
stake in Compañía Logistica de Hidrocarburos CLH, S.A. ("CLH"),
Spain's largest refined products transportation and storage
business.
The principal terms of the agreement, which is expected to be
finalized shortly, will include the acquisition of 25% of the
common shares of CLH for approximately Cdn. $530 million. The
acquisition is expected to be accretive to earnings per share,
beginning in 2002.
Commenting on the acquisition, Pat Daniel, Enbridge President and
CEO said, "We are very pleased to have agreed on the purchase of a
significant interest in CLH. The CLH assets are consistent with
our international strategy and represent what we do best, which is
to provide energy transportation solutions to our customers, both
in North America and internationally. This is a blue chip
investment within the European Union that provides an attractive
return and significant earnings contribution, as well as growth
opportunities related to future liberalized infrastructure
development in Spain and other European markets."
Mr. Daniel added, "This investment demonstrates the progress we've
made on our goal to position Enbridge as a partner of choice for
global energy players. Our objective is to leverage our expertise
in infrastructure operations into the right international
opportunities."
CLH is Spain's leading logistics company in refined products. CLH
owns and operates the largest pipeline network and storage
facilities on the Spanish mainland and Balearic Islands. CLH
operates as a common carrier and employs approximately 2,600
people. Its modern network of pipelines and storage terminals is
the primary means by which Spanish refiners and others supply the
domestic Spanish market. CLH operates a total of more than 3,400
kilometres of products pipelines, 37 products storage facilities
with 38 million barrels of capacity, nine marine tankers and 130
road tanker trailers.
CLH is currently majority owned by operators with refining
capacity in Spain. Liberalization of the Spanish energy sector
requires the existing shareholders to divest a significant
percentage of their current holdings in CLH. Existing CLH
shareholders who will be selling part of their equity interests to
comply with the new regulations include Repsol YPF, BP Oil Espana
S.A., and CEPSA.
Upon closing, it is expected that Enbridge and Repsol YPF will
each own 25% of CLH; CEPSA will own 15% while BP and Shell will
own 5% each. Other shareholders yet to be identified are expected
to acquire the remaining approximate 24% of CLH.
Enbridge will have a significant role in management of CLH through
Board representation, appointment of management positions and,
potentially, through the provision of technical and advisory
services.
The acquisition is subject to final due diligence, execution of
the Purchase and Shareholder Agreements and other customary
closing conditions. The transaction is anticipated to close in the
first quarter of 2002, with an effective date of January 1, 2002.
Enbridge was advised by Deutsche Bank and the Spanish law firm
Gomez-Acebo & Pombo
Enbridge will hold a conference call regarding this announcement
at 6:45 a.m. Mountain time today (8:45 a.m. Eastern time). The
call will be broadcast live on the internet and can be accessed at
www.enbridge.com/investor. A replay will be available shortly
thereafter. A map of the CLH system can be downloaded on the same
Web page.
Enbridge Inc. is a leader in energy transportation, distribution
and services in North America and internationally. As a
transporter of energy, Enbridge operates, in Canada and the U.S.,
the world's longest crude oil and liquids transportation system.
The Company also is involved in international energy projects and
has a growing involvement in the natural gas transmission and
midstream businesses. As a distributor of energy, Enbridge owns
and operates Canada's largest natural gas distribution company,
which provides distribution services in Ontario, Quebec and New
York State; and is developing a gas distribution system for the
province of New Brunswick. In addition, Enbridge provides retail
energy products and services to a growing number of Canadian and
U.S. markets. The Company employs approximately 6,000 people,
primarily in Canada, the U.S. and South America. Enbridge common
shares trade on The Toronto Stock Exchange in Canada and on The
New York Stock Exchange in the U.S., under the symbol ENB.
Information about Enbridge is available on the Company's web site
at www.enbridge.com.
When used in this news release, the words "anticipate", "expect",
"project", "believe", "estimate", "forecast" and similar
expressions are intended to identify forward-looking statements,
which include statements relating to pending and proposed
projects. Such statements are subject to certain risks,
uncertainties and assumptions pertaining to operating performance,
regulatory parameters, weather and economic conditions and, in the
case of pending and proposed projects, risks relating to design
and construction, regulatory processes, obtaining financing and
performance of other parties, including partners, contractors and
suppliers.