Pembina Pipeline Announces Share Conversion Right and Dividends

Pembina Pipeline Corporation's Share Conversion Announcement

Pembina Pipeline Corporation, commonly referred to as Pembina, has made a significant announcement regarding its Cumulative Redeemable Rate Reset Class A Preferred Shares, Series 7. This update is pivotal for shareholders as it outlines the potential conversion of these shares.

Details of the Series 7 Share Conversion

The Company has decided not to redeem the currently outstanding Series 7 Shares on the planned date. Consequently, shareholders will have the option to convert their holdings into the corresponding Cumulative Redeemable Floating Rate Class A Preferred Shares, Series 8 on December 1, 2024.

This conversion will be executed on a one-for-one basis, with the added option for holders to retain their Series 7 Shares if they choose not to convert.

Conditions of the Convertibility

There are specific conditions linked to this conversion. If the outstanding Series 7 Shares fall below 1 million after the conversion, any remaining shares will automatically transition into Series 8 Shares. Alternatively, if Series 8 Shares fall below this threshold post-conversion, the Series 7 Shares will not convert. Currently, there are 10 million Series 7 Shares available.

Dividend Rate Adjustments for Future Periods

Post-conversion, holders of Series 7 Shares will be entitled to quarterly, cumulative cash dividends as declared by Pembina's Board of Directors. The proposed dividend rate is set at 5.953 percent for the five-year period commencing from December 1, 2024, which considers the current five-year Government of Canada bond yield.

On the other side, Series 8 Shareholders can expect quarterly floating rate dividends. These will be declared based on the prevailing rates of Government of Canada treasury bills plus an additional factor of 2.94 percent. The initial dividend rate for Series 8 Shares will be set at 6.583 percent for the period ending March 1, 2025.

Conversion Rights and Schedule for Shareholders

For shareholders looking to execute their conversion rights, the active window runs from November 1 to November 18, 2024. This is the designated period to communicate with brokers to ensure the conversion process is completed timely. Adequate notice before the deadline is encouraged to prevent any last-minute issues.

Upcoming Dividend Payments

Prepare for the upcoming dividend payable on December 1, 2024, which will amount to $0.273750 for each Series 7 Share. Due to scheduling, payment will be processed on December 2, 2024, as the first date is not a business day.

About Pembina Pipeline Corporation

Pembina Pipeline Corporation is recognized as a leading energy transport and midstream service provider in North America, boasting 70 years of service. The Corporation manages a vast network involving pipelines for hydrocarbons and natural gas, alongside essential facilities for gathering, processing, and logistics.

The organization emphasizes the integration of its services to deliver safe energy solutions that benefit both producers and consumers efficiently. Its drive towards sustainable practices also ensures mutual advantages for its customers, investors, employees, and the communities it operates within.

Pembina’s Corporate Structure

Pembina is organized into three divisions: Pipelines Division, Facilities Division, and Marketing & New Ventures Division. Its common shares are actively traded under the tickers PPL on the TSX and PBA on the NYSE, reinforcing its footprint in both the Canadian and U.S. markets.

Frequently Asked Questions

What is the Series 7 Preferred Share Conversion Right?

The Series 7 Preferred Share Conversion Right allows shareholders to convert their Series 7 shares into Series 8 shares on a stipulated date, providing flexibility in managing their investments.

When can shareholders execute their conversion rights?

The conversion period for shareholders is set from November 1 to November 18, 2024, during which they can communicate their intents to their brokers.

What are the new dividend rates for Series 7 and Series 8 shares?

The annual dividend rate for Series 7 Shares has been adjusted to 5.953%, while Series 8 Shares will have a rate of 6.583% for an initial period.

What happens if I do not convert my Series 7 Shares?

If Series 7 shareholders choose not to convert, they will retain their shares and continue to receive dividends based on the adjusted rates.

How can I get more information about my shares?

Shareholders should review the terms provided in the prospectus supplement or reach out to their brokers for detailed information regarding their holdings.

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