Kinder Morgan Canada Limited (KML) will remain a standalone entity.
The options evaluated included, among others, continuing to operate as a standalone enterprise, a disposition by sale, and a strategic combination with another company.
After a multi-month process that involved rigorous analysis of a variety of potential alternatives, the KML board has determined that the current best course of action for the company and its shareholders is for KML to remain a standalone public entity.
This determination was made taking into account and consistent with the recommendation of a special committee of independent directors not affiliated with Kinder Morgan, Inc. The special committee retained independent financial and legal advisors. KML's strategic infrastructure operations across Western Canada are underpinned by multi-year take-or-pay contracts with high quality customers and stable cash flows, and its energy transportation and storage assets are central to the energy infrastructure of Western Canada.
Consistent with its 2019 budget, KML expects to declare a dividend of 65 cents per restricted voting share, generate adjusted EBITDA of approximately $213 million and DCF from continuing operations of approximately $109 million, representing DCF of $0.90 per restricted voting share.
Also, consistent with its budget, KML contemplates investing approximately $32 million in expansion projects, and ending the year with a net debt-to-adjusted EBITDA ratio of approximately 1.3 times (treating 50 per cent of the preferred equity as debt).