Highlights

• Enbridge has entered into definitive agreements with Dominion Energy to acquire The East Ohio Gas Company ("EOG"), Questar Gas Company, and its related Wexpro companies, and Public Service Company of North Carolina, Incorporated ("PSNC") for an aggregate purchase price of US$14.0 billion (CDN$19 billion(1)), comprised of US$9.4 billion of cash consideration and US$4.6 billion of assumed debt.
• Creates North America's largest natural gas utility platform delivering ~9.3 bcf/d to ~7 million customers across multiple regulatory jurisdictions.
• Historically attractive acquisition multiples, based on 2024 estimate of ~1.3x Enterprise Value-to-Rate Base and 2023 estimate of ~16.5x Price-to-Earnings.
• Compounded annual growth rate of approximately 8% on the consolidated rate base is expected to deliver long-term value for Enbridge shareholders.
• Expected to be accretive to distributable cash flow per share ("DCFPS") and adjusted earnings per share ("EPS") in the first full year of ownership, increasing over time driven by the addition of approximately CDN$1.7 billion of annual, low-risk, quick-cycle rate base investments to Enbridge's secured growth backlog.
• Financial guidance in 2023, and near-term and medium-term outlook is maintained; long-term dividend growth profile is strengthened.
• High-quality, utility cash flows from the Gas utilities further reduces Enbridge's already industry leading business risk and balances Enbridge's earnings mix to approximately 50% Natural Gas and Renewables and 50% Liquids upon closing, expected in 2024.
• Funding plan preserves financial flexibility as Enbridge expects to maintain leverage within its target range of 4.5x to 5.0x Debt-to-Adjusted EBITDA.
• Enbridge is looking forward to welcoming the Gas utilities' employees to the Enbridge family and expects to maintain strong relationships with existing local unions and communities.

(1) Translated at USD/CAD $1.36 (the exchange rate as of September 1, 2023).

Enbridge Inc. has entered into three separate definitive agreements with Dominion Energy, Inc. to acquire EOG, Questar and PSNC for an aggregate purchase price of US$14.0 billion (CDN$19 billion), comprised of $US9.4 billion of cash consideration and US$4.6 billion of assumed debt, subject to customary closing adjustments.

Upon the closings of the three transactions, Enbridge will add gas utility operations in Ohio, North Carolina, Utah, Idaho and Wyoming, representing a significant presence in the U.S. utility sector. The Gas utilities fit Enbridge's long held investor proposition of low-risk businesses with predictable cash flow growth and strong overall returns. Following the closings, the Acquisitions will double the scale of the Company's gas utility business to approximately 22% of Enbridge's total adjusted EBITDA and balance the Company's asset mix evenly between natural gas and renewables, and liquids. The Acquisitions will lower Enbridge's already industry-leading business risk and secure visible, low-risk, long-term rate base growth. Increased utility earnings enhance Enbridge's overall cash flow quality and further underpin the longevity of Enbridge's growing dividend profile.

Following the closings of the Acquisitions, Enbridge's gas utility business will be the largest, by volume, in North America with a combined rate base of over CDN$27 billion and about 7,000 employees delivering over 9 Bcf/d of gas to approximately 7 million customers.

The Company estimates its purchase price for the Acquisitions at ~1.3x Enterprise Value-to-Rate Base (based on 2024 estimates) and ~16.5x Price-to-Earnings (based on 2023 estimates) and expects the Acquisitions to be accretive to Enbridge's financial DCFPS and adjusted EPS outlook in the first full year of ownership adding shareholder value.

"Adding natural gas utilities of this scale and quality, at a historically attractive multiple, is a once in a generation opportunity. The transaction is expected to be accretive to DCFPS and adjusted EPS in the first full year of ownership, increasing over time due to the strong growth profile," said Greg Ebel, Enbridge President and CEO. "Following the closings of the Acquisitions, our Gas Distribution and Storage ("GDS") business will be North America's largest gas utility franchise. These Acquisitions further diversify our business, enhance the stable cash flow profile of our assets, and strengthen our long-term dividend growth profile.  The transaction also reinforces our position as the first-choice energy delivery company in North America.

"The assets we are acquiring have long useful lives and natural gas utilities are 'must-have' infrastructure for providing safe, reliable and affordable energy.  In addition, these gas utilities have each committed to achieving net-zero greenhouse gas emissions by 2050 and are expected to play a critical role in enabling a sustainable energy transition. We are very excited by today's announcement as these businesses align with Enbridge's business risk model and long-term growth targets. The entire Enbridge team is committed to working with the EOG, Questar and PSNC teams and to investing in the communities they serve. We look forward to serving our customers with dedication and to providing them with safe, reliable, and affordable energy service for years to come."

The Gas utilities are domiciled in premier U.S. jurisdictions with transparent and constructive regulatory regimes that preserve customer choice to consume natural gas and have attractive capital growth programs. EOG, Questar and PSNC each have lower-carbon initiatives that are similarly aligned with Enbridge's ESG goals.

Each of the Gas utilities have an excellent operating and safety track record. The experienced operating teams of each business will be joining the Enbridge team. Keeping with Enbridge's history of successfully integrating acquired businesses, we expect to be able to integrate the Gas utilities' businesses smoothly while continuing to deliver the service our customers expect.

"Today and for the long-term, natural gas will remain essential for achieving North America's energy security, affordability and sustainability goals. Individually and collectively, the Gas utilities are perfectly complementary to our gas distribution business unit's current operations and strategy. These utilities operate in regions with very attractive regulatory regimes, offer diverse, low-risk growth opportunities, and are capital efficient with short cycles between capital deployments and earnings generation," said Michele Harradence, President of GDS and Executive Vice President at Enbridge. "We are excited to be welcoming over 3,000 new employees into the Enbridge family.  In addition, we intend to continue the robust social, community and diversity, equity and inclusion initiatives that each Gas utility has committed to."

COMMITMENT TO EOG, PSNC AND QUESTAR COMMUNITIES, CUSTOMERS, AND EMPLOYEES

Following the closings of the Acquisitions, EOG, PSNC and Questar each will continue to be regulated by the Public Utility Commission of Ohio, the North Carolina Utilities Commission, and the Public Service Commissions of Utah, Wyoming and Idaho, respectively. Enbridge looks forward to establishing a collaborative and mutually beneficial relationship with each of these regulatory bodies.

Enbridge's existing natural gas utility has proudly served its customers for 175 years and has built its business on the key pillars of safety, reliability, affordability and customer service. Enbridge actively invests in the communities it serves and looks forward to continuing the community service legacies of EOG, PSNC and Questar in their respective states. In addition, Enbridge offers a competitive and flexible Total Compensation package to its staff and seeks to maintain strong relationships with local unions and the local workforce.

FINANCIAL CONSIDERATIONS

Today's equity offering, announced separately, is expected to fully address the Company's planned discrete common equity issuance needs to finance this transaction. It ensures the remaining funding requirements can be readily satisfied through a variety of alternate sources including hybrid debt securities and senior unsecured notes, continuing the Company's ongoing capital recycling program, potential reinstatement of Enbridge's Dividend Reinvestment and Share Purchase Plan, or At-The-Market equity issuances. The acquisition of each Gas utility is expected to close in 2024, upon receipt of the applicable required federal and state regulatory approvals, which allows Enbridge flexibility to optimally balance the mix of financing alternatives prior to each closing. These sources may change, subject to market conditions and other factors.

Enbridge has obtained debt financing commitments totaling US$9.4 billion from Morgan Stanley and Royal Bank of Canada for the cash consideration component of the Acquisitions in order to further demonstrate liquidity and the financing capacity to close the transactions.

The Company is committed to maintaining its financial strength. The funding program for the Acquisitions is designed to maintain the Company's balance sheet within its previously communicated target leverage range of 4.5x to 5.0x Debt-to-Adjusted EBITDA with the objective of retaining its strong investment grade credit ratings.

"Acquiring these natural gas utilities makes strong strategic and financial sense. Enbridge is currently the only major pipeline and midstream company that owns a regulated gas utility and we've further strengthened that position today by doubling the size of our GDS business. After closings, the Acquisitions will extend and diversify our natural gas footprint and importantly add low-risk, ratable investments to our growth portfolio" said Patrick Murray, Executive Vice President and Chief Financial Officer, Enbridge. "The financing plan for the transaction includes significant equity pre-funding and a suite of financing options that will be optimized to maximize accretion and protect our strong investment grade ratings."

FINANCIAL OUTLOOK

The Company reaffirms its 2023 financial guidance, while planning to raise a significant portion of the financing required for the Acquisitions this year. After the closings, the Acquisitions are expected to provide immediate high-quality cash flow and deliver significant EBITDA growth in their first full fiscal year of Enbridge's ownership. The Gas utilities have attractive embedded DCF and earnings growth, strengthening Enbridge's near-term and medium-term financial outlook. Sustainably returning capital to shareholders remains a key priority and Enbridge plans to continue to grow its dividend up to its level of medium-term distributable cash flow growth.

Collectively, the Company expects the Gas utilities to add CDN$1.7 billion of average annual low-risk, long-term capital investment opportunities, with significant built-in rate rider mechanisms, enabling timely recovery of capital investments.

TIMING AND APPROVALS

The Acquisitions are expected to close in 2024, subject to the satisfaction of customary closing conditions, including the receipt of certain required U.S. federal and state regulatory approvals. These include clearance from the Federal Trade Commission under Hart-Scott-Rodino Antitrust Improvements Act of 1976, approval from the Federal Communications Committee, and approval from the Committee on Foreign Investment in the United States as well as approvals from state public utility commissions that regulate EOG, Questar, and PSNC. Closing of the purchase of each Gas utility acquisition is expected to occur following receipt of each regulatory approvals applicable to each utility, and are not cross-conditioned across all three Gas utilities.

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