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PROPOSED CORPORATE REORGANIZATION August 2010
Copyright © 2010, Gaz Métro Limited Partnership. All rights reserved.
CAUTION CAUTION
Implementation of the Implementation of the proposed structure is proposed structure is subject to the realization subject to the realization of pre-conditions, some of of pre-conditions, some of which are beyond the which are beyond the control of Gaz Métro. control of Gaz Métro. Gaz Métro cannot provide Gaz Métro cannot provide any assurance these any assurance these conditions will be realized conditions will be realized at the appropriate time.at the appropriate time.
CONTEXTCONTEXT
On October 31, 2006, Canada’s Finance Minister, Jim On October 31, 2006, Canada’s Finance Minister, Jim Flaherty, announced the introduction of a Tax Fairness Plan Flaherty, announced the introduction of a Tax Fairness Plan starting with the 2011 fiscal year (October 1, 2010 for starting with the 2011 fiscal year (October 1, 2010 for Gaz Métro). Gaz Métro).
The basic objective of the Plan is to standardize the tax The basic objective of the Plan is to standardize the tax treatment of certain Canadian entities whether they be treatment of certain Canadian entities whether they be corporations, income trusts, limited partnerships or other corporations, income trusts, limited partnerships or other types of organizations.types of organizations.
CONTEXTCONTEXT
Under the present tax rules, income trusts and limited Under the present tax rules, income trusts and limited partnerships, like Gaz Métro, are not taxable. partnerships, like Gaz Métro, are not taxable.
In this context, Gaz Métro distributes its net income to its In this context, Gaz Métro distributes its net income to its Partners who pay the income taxes thereon.Partners who pay the income taxes thereon.
Effective October 1, 2010, if Gaz Métro continues to be a Effective October 1, 2010, if Gaz Métro continues to be a public partnership, it will be taxable, which means that its public partnership, it will be taxable, which means that its after-tax net income, and therefore the distributions paid to after-tax net income, and therefore the distributions paid to Partners, will be lower than under the present rules.Partners, will be lower than under the present rules.
CU
RR
ENT
STR
UC
TUR
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Gaz Métro would become fully taxable after
September 30, 2010 if it remained a public entity.
Gaz Métro Inc. and minority holders would be equally
impacted by reduction in Gaz Métro after-tax adjusted net
income available for distribution
CU
RR
EN
T S
TR
UC
TU
RE
CU
RR
EN
T S
TR
UC
TU
RE
50,38% 17,56%32,06%
100%
PublicLimited Partners
PublicLimited Partners
29,0%
(1) Trencap : Caisse de dépôt et placement du Québec (51,11%), Fonds de solidarité FTQ (16,66%), SNC-Lavalin Inc. (11,11%), BC Investment Management Corporation (11,11%), Régime des rentes du Mouvement Desjardins (8,33%), Régime de retraite de l’Université du Québec (1,67%)
100%
Gaz MétroÉole inc.
71,0%
Gaz Métro inc.General Partner
Gaz Métro inc.General Partner
Noverco inc.Noverco inc.
Boralex inc.
Trencaps.e.c. (1)
Trencaps.e.c. (1)
Enbridge
Inc.Enbridge
Inc. GDF SUEZGDF SUEZ
50 %Seigneurie
Wind Power Project
50 %
Other Investments
Other Investments
Gaz Métro Limited
Partnership
Gaz Métro Limited
Partnership
PROPOSED
STRUCTURE
50%Seigneurie
Wind Power Project
50%
29%
Creation and incorporation of a new public entity (Valener) and exchange of each unit of Gaz Métro held by the public
for one share of Valener.
Gaz Métro becomes a private Limited Partnership.
PR
OP
OS
ED
ST
RU
CT
UR
EP
RO
PO
SE
D S
TR
UC
TU
RE
50,38% 17,56%32,06%
100%
(1) Trencap : Caisse de dépôt et placement du Québec (51,11%), Fonds de solidarité FTQ (16,66%), SNC-Lavalin Inc. (11,11%), BC Investment Management Corporation (11,11%), Régime des rentes du Mouvement Desjardins (8,33%), Régime de retraite de l’Université du Québec (1,67%)
100%
51%
49%
Noverco inc.Noverco inc. Option for the transfer at cost of 49% of Gaz Métro interest in
Seigneurie Wind Power Project, within 90 days of closing of the
proposed reorganization, granted to Valener
71%
Gaz Métro inc.General Partner
Gaz Métro inc.General Partner
Boralex inc.
Trencaps.e.c. (1)
Trencaps.e.c. (1)
Enbridge
Inc.Enbridge
Inc. GDF SUEZ GDF SUEZ
PublicPublic
29%Valener Inc.Limited Partner
Valener Inc.Limited Partner
Gaz Métro Éole inc.
Other Investments
Other Investments
Gaz Métro Limited
Partnership
Gaz Métro Limited
Partnership
NEXT STEPSNEXT STEPS
Implementation of the proposed structure is subject to Implementation of the proposed structure is subject to a number of conditions, including:a number of conditions, including:
1.1. Getting the required consents; Getting the required consents;
2.2. A favourable vote of the Partners (unitholders) at a meeting A favourable vote of the Partners (unitholders) at a meeting in September 2010; in September 2010;
3.3. Approval of the Superior Court of Québec. Approval of the Superior Court of Québec.
Expected closing by September 30, 2010 Expected closing by September 30, 2010
For all the details, see also the complete presentation "Gaz Métro’s Response to Tax Fairness Plan (SIFT rules)" available on our website
www.gazmetro.com/investors
Contact us Investors 514 598-3039www.gazmetro.com/investors
Media514 598-3449www.gazmetro.com/pressroom