TransCanada to Sell North Baja Pipeline to TC PipeLines, LP

TransCanada Corporation (TransCanada) has entered into an agreement to sell North Baja Pipeline, LLC (North Baja) to TC PipeLines, LP (the Partnership).

As part of the transaction, an affiliate of TransCanada, TC PipeLines GP, Inc. (the General Partner), agreed to amend its Incentive Distribution Rights (IDR) with the Partnership.  

The aggregate consideration received from the Partnership will include a combination of cash and common units totaling approximately US$395 million. TransCanada will receive approximately US$200 million in cash and 6,371,680 common units of the Partnership. With the close of this transaction, expected by the end of second quarter 2009, TransCanada’s ownership of the Partnership will increase to 42.6 per cent.

“We are in the midst of a large capital program that will create significant long-term value for our shareholders and the proceeds from the sale of North Baja will be redeployed to help fund our growth initiatives,” said Hal Kvisle, president and chief executive officer of TransCanada. “The sale of North Baja, the restructuring of the Incentive Distribution Rights and the increased ownership of TransCanada all position the Partnership to potentially play a greater role in the financing of TransCanada's $19 billion capital program.”

Return to June 2009 Western Energy News

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