Enbridge to acquire Montana Alberta Tie line

Tonbridge Power Inc. of Toronto has agreed to be acquired by pipeline firm Enbridge Inc. and has settled a contract dispute with Rocky Mountain Contractors over construction of an electrical power transmission line between Alberta and Montana. Montana Alberta Tie line will run from a substation near Lethbridge, Alberta to another near Great Falls, Montana. Montana Alberta Tie Ltd. (MATL) is a wholly-owned subsidiary of Tonbridge.

Calgary-based Enbridge said it intends to complete the Montana Alberta Tie line, a 345-kilometre transmission line that will run from a substation near Lethbridge, Alberta to another near Great Falls, Montana. Montana Alberta Tie Ltd. (MATL) is a wholly-owned subsidiary of Tonbridge Power. In June, MATL stopped work on the tie line over a dispute with Rocky Mountain Contractors.

MATL has terminated all aspects of its contractual relationship with respect to the engineering, procurement and construction contract with RMC to build the tie line. MATL has agreed to forfeit US$12 million in security that RMC is holding in escrow against payables and has also agreed to pay RMC $1 million. RMC has agreed remove all liens associated with MATL and to transfer all the assets associated with it, such as drawings, to a new contractor.

If the deal is approved by at least two-thirds of Tonbridge shareholders, Enbridge would pay $20 million to acquire Tonbridge shares and to pay about $50 million in MATL debts. “In addition, the Arrangement will be subject to certain customary conditions, including court approval, relevant regulatory approvals and the absence of any material adverse effect with respect to the Corporation,” Tonbridge stated in a press release.

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