Canada-based pipeline company Enbridge has agreed to acquire US based firm Spectra Energy in a deal worth C$37bn ($28bn) in a bid to create the largest energy infrastructure company in North America.

The merger deal is expected to have a enterprise value of approximately C$165bn.

Scheduled to be completed in the first quarter of 2017, the transaction is subject to shareholder and certain regulatory approvals, and other customary conditions.

Under the terms of the deal, shareholders of Spectra Energy will receive 0.984 shares of the combined company for each share held.

The combined company, Enbridge, will have an asset base including crude oil, liquids and natural gas pipelines, terminal and midstream operations, a regulated utility portfolio and renewable power generation.

Enbridge president and CEO Al Monaco said: "Over the last two years, we've been focused on identifying opportunities that would extend and diversify our asset base and sources of growth beyond 2019.

"This Transaction is transformational for both companies and results in unmatched scale, diversity and financial flexibility with multiple platforms for organic growth."

Upon completion of deal, Enbridge shareholders are expected to own approximately 57% of the combined company, while Spectra Energy shareholders are expected to hold approximately 43%.

Monaco added: "With combined secured projects in execution of C$26bn ($20bn) and another C$48bn ($37bn) of projects under development, the transaction allows us to extend our anticipated 10-12% annual dividend growth through 2024.”

The combined entity is expected to deliver annual synergies of about $540m.

In 2015, Enbridge said it is looking to invest C$38bn ($29.09bn) over the next four years on new projects including liquids and natural gas lines.

The decision comes as the company plans to shift its focus on natural gas sector and the Gulf Coast for growth as new oil sand projects face delay in Canada.

Image: Spectra Energy’s natural gas compressor station in US. Photo: courtesy of Spectra Energy Corp.