CALGARY, Alberta--(BUSINESS WIRE)--Kinder Morgan Canada Limited (TSX:KML) (the Company) and Kinder Morgan, Inc. (NYSE: KMI) (Kinder Morgan) announced today the completion of the initial public offering (the Offering) of 102,942,000 restricted voting shares of the Company (restricted voting shares) at a price to the public of $17.00 per share (the Offering Price) for total gross proceeds of approximately C$1.75 billion. The proceeds of the Offering will be used by the Company to indirectly acquire from Kinder Morgan an approximate 30% interest in a limited partnership that holds the Canadian business of Kinder Morgan. Kinder Morgan will use the proceeds it receives to pay down debt. Closing of the Offering removed the final condition to Kinder Morgan’s investment approval for the Trans Mountain Expansion Project.
The Offering was made through a syndicate of underwriters co-led and joint bookrun by TD Securities Inc. and RBC Capital Markets. The underwriters have been granted an over-allotment option to purchase up to an additional 15,441,300 restricted voting shares at the Offering Price, exercisable in whole or in part, from time to time, until 30 days after closing of the Offering.
At the closing of the Offering, Kinder Morgan holds approximately 70% of the issued and outstanding shares of the Company through its indirect ownership of 242,058,000 special voting shares. Kinder Morgan also holds an approximate 70% interest in the limited partnership that holds the Business. The restricted voting shares will begin trading today on the Toronto Stock Exchange under the symbol 'KML'.
The Company's securities 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 state securities laws. Accordingly, these securities may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or except pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the Company's securities in the United States.
About Kinder Morgan Canada Limited (KML)
Kinder Morgan Canada Limited will operate the Business, comprised of a number of pipeline systems and terminal facilities including the Trans Mountain pipeline, the Canadian portion of the Cochin pipeline, the Puget Sound and Trans Mountain Jet Fuel pipelines, the Westridge marine and Vancouver Wharves terminals in British Columbia as well as various crude oil loading facilities in Edmonton, Alberta.
The Trans Mountain pipeline currently transports approximately 300,000 barrels per day (bpd) of crude oil and refined petroleum products from the oil sands in Alberta to Vancouver, British Columbia and Washington state. On Nov. 29, 2016, the Government of Canada granted approval for the $7.4 billion Trans Mountain Expansion Project, to increase the nominal capacity of the system to 890,000 bpd. The expanded pipeline is expected to be in service at the end of 2019.
About Kinder Morgan, Inc. (KMI)
Kinder Morgan, Inc. (NYSE: KMI) is one of the largest energy infrastructure companies in North America. It owns an interest in or operates approximately 84,000 miles of pipelines and 155 terminals. KMI’s pipelines transport natural gas, refined petroleum products, crude oil, condensate, CO2 and other products, and its terminals transload and store petroleum products, ethanol and chemicals, and handle such products as steel, coal and petroleum coke. It is also a leading producer of CO2 that we and others use for enhanced oil recovery projects primarily in the Permian basin. For more information please visit www.kindermorgan.com.
ADVISORY REGARDING FORWARD-LOOKING STATEMENTS - In the interests of providing the Company and Kinder Morgan shareholders and potential investors with information, certain statements contained in this news release are forward-looking statements or information within the meaning of applicable securities legislation, collectively referred to herein as "forward-looking statements." Forward-looking statements in this news release include, but are not limited to: Kinder Morgan's expected ownership level in the Company if the over-allotment option is exercised in full and the use of proceeds from the Offering.
Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause Kinder Morgan's or the Company's actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. There can be no assurance of the size of the retained interest that Kinder Morgan would hold in the future in the Company and other arrangements that would exist between Kinder Morgan and the Company. Although Kinder Morgan and the Company believe that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the foregoing list of important factors is not exhaustive. In addition, assumptions relating to such forward-looking statements generally include Kinder Morgan's and the Company's current expectations and projections made in light of, and generally consistent with, its historical experience and its perception of historical trends, all of which are subject to the risk factors identified elsewhere in this news release.
Furthermore, the forward-looking statements contained in this news release are made as of the date hereof and, except as required by law, Kinder Morgan and the Company undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.