Topic: How To Invest

Dividend Advisor Hotline – Friday, July 14, 2017

Article Excerpt

PEMBINA PIPELINE CORP., $42.99, Toronto symbol PPL, recently agreed to buy rival pipeline operator VERESEN INC., $18.31, Toronto symbol VSN. Under the deal, Veresen investors can choose either $18.65 in cash or 0.4287 shares of Pembina for each share they hold. However, Pembina has capped the total amount of cash it will pay. As a result, most Veresen shareholders will get $4.8494 in cash and 0.3172 of a Pembina share. Based on the current Pembina share price, that would equal $18.49 per Veresen share. That’s more than the current trading price and indicates that investors don’t expect a higher offer. Veresen has gained about 20% since Pembina announced its takeover bid. This week, Veresen shareholders voted to accept the Pembina’s offer. The companies now expect to complete the deal by September 30, 2017. Following the purchase, Pembina will raise its monthly dividend by 5.9%, to $0.18 from $0.17. The new annual rate of $2.16 will yield a high 5.0%. Pembina’s TSI Dividend Sustainability…