NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
CALGARY, Feb. 3, 2012 /CNW/ - Veresen Inc. ("Veresen") (TSX: VSN) announced today it will issue 6,000,000 Cumulative
Redeemable Preferred Shares, Series A ("Series A Preferred Shares") at a price of $25.00 per share (the "Offering") for aggregate gross proceeds of $150 million on a bought deal basis.
The Series A Preferred Shares will be offered to the public through a
syndicate of underwriters co-led by Scotiabank, TD Securities Inc. and
The holders of Series A Preferred Shares will be entitled to receive
fixed cumulative dividends at an annual rate of 4.40%, payable
quarterly for an initial period up to but excluding September 30, 2017,
as and when declared by the Board of Directors of Veresen. The first
quarterly dividend payment date is scheduled for June 30, 2012. The
dividend rate will reset on September 30, 2017 and every five years
thereafter at a rate equal to the sum of the then five-year Government
of Canada bond yield plus 2.92%. The Series A Preferred Shares are
redeemable by Veresen, at its option, on September 30, 2017 and on
September 30 of every fifth year thereafter.
Holders of Series A Preferred Shares will have the right to convert all
or any part of their shares into Cumulative Redeemable Preferred
Shares, Series B ("Series B Preferred Shares"), subject to certain conditions, on September 30, 2017, and on
September 30 of every fifth year thereafter. The holders of Series B
Preferred Shares will be entitled to receive quarterly floating rate
cumulative dividends, as and when declared by the Board of Directors of
Veresen, at a rate equal to the sum of the then 90-day Government of
Canada treasury bill rate plus 2.92%.
Veresen has granted the underwriters an option to purchase at the
offering price an additional 2,000,000 Series A Preferred Shares
exercisable in whole or in part at any time up to 6:30 AM (Calgary
time) on the date that is two business days prior to closing. Should
the option be fully exercised, the total gross proceeds of the Offering
will be $200 million.
The Offering is expected to close on or about February 14, 2012. Net
proceeds from the Offering will be used to reduce indebtedness,
partially fund capital expenditures and for other general corporate
The Series A Preferred Shares will be issued pursuant to a prospectus
supplement that will be filed with the securities regulatory authority
in each of the provinces of Canada under Veresen's short form base
shelf prospectus dated August 22, 2011. An application has been made to
list the Series A Preferred Shares and the Series B Preferred Shares on
the Toronto Stock Exchange. The Offering is subject to receipt of all
necessary regulatory and stock exchange approvals.
The Series A Preferred Shares have not been registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold in
the United States absent registration or an applicable exemption from
the registration requirements. This news release shall not constitute
an offer to sell or the solicitation of an offer to buy, nor shall
there be any offer, solicitation or sale of the securities in any state
in which such offer, solicitation or sale would be unlawful.
About Veresen Inc.
Veresen is a publicly-traded dividend paying corporation based in
Calgary, Alberta, that owns and operates energy infrastructure assets
across North America. Veresen is engaged in three principal
businesses: a pipeline transportation business comprised of interests
in two pipeline systems, the Alliance Pipeline and the Alberta Ethane
Gathering System; a midstream business which includes ownership
interests in a world-class natural gas liquids extraction facility near
Chicago and other natural gas and NGL processing energy infrastructure;
and a power business with renewable and gas-fired facilities and
development projects in Canada and the United States, and district
energy systems in Ontario and Prince Edward Island. Veresen and each of
its pipeline, midstream and power businesses are also actively
developing a number of greenfield projects. In the normal course of
its business, Veresen and each of its businesses regularly evaluate and
pursue acquisition and development opportunities.
Veresen's common shares, subscription receipts and 5.75% convertible
unsecured subordinated debentures, Series C due July 31, 2017 are
listed on the Toronto Stock Exchange under the symbols "VSN", "VSN.R"
and VSN.DB.C", respectively. For further information, please visit www.vereseninc.com.
Forward Looking Information
Certain information contained herein relating to, but not limited to,
Veresen and its businesses and the offering of the Series A Preferred
Shares, constitutes forward-looking information under applicable
securities laws. All statements, other than statements of historical
fact, which address activities, events or developments that Veresen
expects or anticipates may or will occur in the future, are
forward-looking information. Forward-looking information typically
contains statements with words such as "may", "estimate", "anticipate",
"believe", "expect", "plan", "intend", "target", "project", "forecast"
or similar words suggesting future outcomes or outlook. Forward-looking
statements in this news release include, but are not limited to,
statements with respect to the timing of completion of the Offering,
the use of the proceeds of the Offering and dividend rates. Additional
information on risks, uncertainties and factors that could affect
Veresen's operations or financial results is included in its filings
with the securities commissions or similar authorities in each of the
provinces of Canada, as may be updated from time to time. Readers are
also cautioned that such additional information is not exhaustive. The
impact of any one risk, uncertainty or factor on a particular
forward-looking statement is not determinable with certainty as these
factors are independent and management's future course of action would
depend on its assessment of all information at that time. Although
Veresen believes that the expectations conveyed by the forward-looking
information are reasonable based on information available on the date
of preparation, no assurances can be given as to future results, levels
of activity and achievements. Undue reliance should not be placed on
the information contained herein, as actual results achieved will vary
from the information provided herein and the variations may be
material. Veresen makes no representation that actual results achieved
will be the same in whole or in part as those set out in the
forward-looking information. Furthermore, the forward-looking
statements contained herein are made as of the date hereof, and Veresen
does not undertake any obligation to update publicly or to revise any
forward-looking information, whether as a result of new information,
future events or otherwise, except as required by applicable laws. Any
forward-looking information contained herein is expressly qualified by
this cautionary statement.
SOURCE Veresen Inc.
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