Calgary-based Enbridge Inc. is exiting the natural gas distribution business in Vermont and some of Quebec with the sale of its stakes in Noverco Inc.*
The Calgary-based pipeline and utility conglomerate agreed to sell for C$1.14 billion ($912 million) its 38.9% share to Trencap LP. Trencap now has 100% of the company as it was majority owner with a 61.1% stake.
Enbridge was able to “opportunistically monetize this nonstrategic financial investment in Noverco at an attractive valuation and surface this value for our shareholders,” said CFO Colin Gruending.
Noverco indirectly owns Quebec-based Énergir LP, which has interests primarily in gas distribution and power distribution in Quebec and Vermont.
Enbridge would continue to own Ontario franchises based in Chatham and Toronto, which make it the largest gas distribution network in Canada, with more than three million customers. Enbridge Gas Inc. now serves about 75% of Ontario residents. Through its subsidiary Gazifere, Enbridge would also still supply natural gas to about 43,500 residential, commercial, institutional and industrial customers within Quebec.*
Enbridge affiliates overall service about 15 million people in Ontario and Quebec through residential, commercial, institutional and industrial meter connections. Affiliates also distribute about 2.3 Bcf/d of gas.
Enbridge, which expects the sale to be completed by early 2022, would use the proceeds to repay debt.
*Correction: In the original article, NGI incorrectly stated that Enbridge was exiting the natural gas distribution business in Quebec. The company still supplies natural gas in the province through subsidiary Gazifere, which was not part of the sale. NGI regrets the error.
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