Veresen Announces Early Redemption of 5.75% Convertible Unsecured Subordinated Debentures, Series C

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

CALGARY, Sept. 16, 2014 /CNW/ - Veresen Inc. ("Veresen" or "the Company") (TSX: VSN) announced today that it has issued a notice of redemption to the holders of its currently outstanding 5.75% Convertible Unsecured Subordinated Debentures, Series C due July 31, 2017 (the "Series C Debentures").  As set out in the notice of redemption, Veresen intends to redeem all of the Series C Debentures issued and outstanding as of October 20, 2014 (the "Redemption Date").  The Series C Debentures are redeemable at a price equal to the principal amount thereof (the "Redemption Price"), plus accrued and unpaid interest thereon to, but excluding, the Redemption Date, less any tax required by law to be deducted.  As of the close of business on September 15, 2014, there was $84,325,000 million principal amount of Series C Debentures issued and outstanding.  The accrued and unpaid interest on the Series C Debentures issued and outstanding as of the Redemption Date will be $12.60 per $1,000 principal amount of Series C Debentures.

"We are pleased that the strong performance of our equity has put us in a position to redeem the Series C Debentures well in advance of their mid-2017 due date," stated Theresa Jang, Senior Vice President, Finance and Chief Financial Officer of Veresen.  "The early redemption further strengthens our investment grade balance sheet by reducing our indebtedness and eliminating our obligation to make future interest payments, which will enhance our future financial flexibility."

Pursuant to the terms of the Series C Debentures, the Company has irrevocably elected to satisfy its obligation to pay the holders of all of the Series C Debentures issued and outstanding as of the Redemption Date all of the Redemption Price by issuing and delivering to such holders that number of common shares of the Company (the "Common Shares") obtained by dividing the Redemption Price by 95% of the current market price of the Common Shares on the Redemption Date.  For this purpose, the current market price will be calculated based on the volume weighted average trading price of the Common Shares on the Toronto Stock Exchange (the "TSX") for the 20 consecutive trading days ending on the fifth trading day preceding the Redemption Date or October 10, 2014.  The Company anticipates announcing the current market price to be used to calculate the number of Common Shares that each holder of Series C Debentures will receive on the redemption of the Series C Debenture on or about October 14, 2014.

Prior to the redemption of the Series C Debentures on the Redemption Date, each holder of the Series C Debentures has the right to convert their Series C Debenture into Common Shares at a conversion price of $14.60 per share (the "Conversion Price") at any time on or prior to October 17, 2014.  A holder of Series C Debentures electing to convert the principal amount of their Series C Debentures will receive 68.49315 Common Shares for each $1,000 principal amount of Series C Debentures converted plus a cash payment equal to the accrued and unpaid interest thereon to, but excluding, the conversion date, less any tax required by law to be deducted. 

No fractional Common Shares will be issued on the redemption or conversion of the Series C Debentures, but, in lieu thereof, the Company will pay the cash equivalent thereof determined on the basis of the current market price of Common Shares on the Redemption Date or the conversion date, as applicable, less any tax required by law to be deducted.

As the Series C Debentures were issued in "book-entry only" form and are held by CDS Clearing and Depositary Services Inc., beneficial holders of Series C Debentures must contact their broker, dealer, bank, trust company or other nominee to exercise their right to convert the Series C Debentures. Beneficial holders of Series C Debentures should ensure that they contact their broker, dealer, bank, trust company or other nominee well in advance of the Redemption Date to confirm the procedures and deadlines relating to the exercise of their right of conversion.  All holders of Series C Debentures who fail to deliver a notice of conversion on or prior to October 14, 2014 (or such earlier time as may be required by their broker, dealer, bank, trust company or other nominee) shall have their Series C Debentures redeemed on the Redemption Date and shall receive that number of Common Shares obtained by dividing the Redemption Price by 95% of the current market price of the Common Shares on the Redemption Date.

This news release does not constitute an offer to sell or the solicitation of an offer to buy the notes in any jurisdiction in which such an offer, solicitation or sale would be unlawful.  The notes have not been approved or disapproved by any regulatory authority.  The notes 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 securities laws of any state of the United States and may not be offered, sold or delivered in the United States or to, or for the account or benefit of, a "U.S. person" (as such term is defined in Regulation S under the U.S. Securities Act) unless an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws is available.

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, the Hythe/Steeprock gas gathering and processing complex, and other natural gas and NGL processing energy infrastructure; and a power business focused on gas-fired, renewable and district energy facilities. Veresen is also actively developing a number of greenfield projects and regularly evaluates and pursues acquisition and development opportunities.

Veresen's common shares, Series A preferred shares, Series C preferred shares, and 5.75% convertible unsecured subordinated debentures, Series C due July 31, 2017 are listed on the TSX under the symbols "VSN", "VSN.PR.A", "VSN.PR.C" 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 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 anticipated timing of announcing the current market price to be used to calculate the number of Common Shares that each holder of Series C Debentures will receive on the redemption their Series C Debentures.   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.

For further information: Dorreen Miller, Director, Investor Relations, Phone: (403) 213-3633, Email: investor-relations@vereseninc.com

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Veresen Inc.

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