Barclays Investment Banking Pitch Book
TransCanada / Columbia Pipeline Transaction Overview
On November 1, 2016, TransCanada Corporation (NYSE: TRP) announced that it had agreed to
purchase all of the remaining common units of Columbia Pipeline Partners, LP (NYSE: CPPL) in an
all-cash offer
Transaction Overview
TransCanada Corporation ("TRP") acquired the LP interests in
Columbia Pipeline Partners, LP ("CPPL") that it did not already own for
cash
■
On September 26, 2016, TRP submitted an initial offer of
$15.75/unit
On November 1, 2016, TRP increased offer to $17.00/unit
Merger subject to a majority vote of unitholders
Merger Agreement and Merger Transactions were recommended to
CPPL unitholders by the CPPL GP Conflicts Committee
Status Quo
TransCanada
Corporation
(NYSE: TRP)
Ownership Summary
46.5% LP Interest, GP
Interest, 100% IDRS
Public
Unitholders
53.5% LP
Ownership
Columbia Pipeline
Partners, LP
(NYSE: CPPL)
Pro Forma
BARCLAYS
TRP
100.0% Ownership
Columbia Pipeline
Partners, LP
Source: Company filings, press releases
1. CPPL net debt includes affiliated debt
2 EBITDA projections reflect consensus estimates at the time of the transaction.
Management Commentary
"The decision to acquire Columbia Pipeline Partners completes our review of
strategic alternatives for our master limited partnership (MLP) holdings
following the Columbia transaction. Through the acquisition of the Partnership,
our interest in the principal Columbia assets, Columbia Gas Transmission and
Columbia Gulf Transmission, effectively increases from 91.6 per cent to 100
per cent and allows us to fully capture the growth associated with
Columbia's large capital program. It is also expected to be accretive to
earnings per share and reduces complexity by leaving us with a single
MLP in TC PipeLines, LP, which remains a core element of TransCanada's
future strategy."
CPPL Transaction Multiples
($ in millions, except per unit amounts)
Purchase Price Per Unit
LP Units Outstanding
Total Equity Value
Plus: Net Debt()
Plus: Non-Controlling Interest
Total Enterprise Value
EV / EBITDA
2016E
2017E
2018E
-Russ Girling (President & CEO, TransCanada)
November 1, 2016
DRAFT
Statistic
$712.7
809.3
1,082.5
CPPL
9/30/16
$17.00
53.8
$915.3
1,744.0
6,228.8
$8,888.1
Multiple
125
11.0x
8.2xView entire presentation