TC PipeLines’ largest non–affiliated unitholder to vote against the deal on the basis that the all-stock offer is inadequate
TC Energy’s previously announced $1.68bn merger deal with TC PipeLines is being opposed by Energy Income Partners (EIP), the largest non–affiliated unitholder of the latter.
According to Energy Income Partners, TC Energy’s offer of 0.70 of its common shares for each unit of TC PipeLines is not adequate.
The Connecticut-based asset manager said that the currently offered consideration significantly undervalues the assets and existing organic growth opportunities of TC PipeLines.
Energy Income Partners said that it has advised the board of directors of the general partner of TC PipeLines that it plans to vote against the proposed merger.
The asset manager holds over 10% of the units outstanding and has held a position in the US-based midstream company for almost 15 years.
Meanwhile, TC PipeLines said that independent proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis & Co. have recommended its unitholders to vote in favour of the merger with TC Energy.
The midstream company stated: “We are pleased that both ISS and Glass Lewis share our belief that the merger with TC Energy is in the best interests of our unitholders and we strongly urge all holders to follow these recommendations by voting “FOR” the merger at the upcoming special meeting.”
Announced in December 2020, the deal is expected to be closed in Q1 2021. However, this will be subject to requisite unitholder approval and the meeting of the remaining closing conditions.
Post-merger, TC PipeLines will be an indirect 100% owned subsidiary of TC Energy and will stop being a publicly held partnership.
Currently, TC PipeLines operates as a Delaware master limited partnership. It has stakes across eight federally regulated interstate natural gas pipelines that cater to markets in the Western, Midwestern, and Northeastern US.