From CBC News In an interview, TC Energy CEO Francois Poirier said the company's board of directors has approved the plan, which comes as the result of a two-year strategic review.
Poirier said now, more than ever, it's apparent that all types of energy are required to meet global demand. While TC Energy has its fingers in many different pies, from natural gas delivery to crude oil transport to nuclear through its part ownership of Ontario's Bruce Power, the company felt that separating its lines of business would allow for faster growth.
"When we took a step back and looked at all the opportunity we had in all of our franchises, it was way more than we could ... pursue as one company, given our financial and human capacity," Poirier said.
"It's simply a case of having limited resources, and we feel like we can pursue a bigger percentage of our opportunity set as two different companies."
'We're unlocking tremendous value, in my view, by creating two premium energy infrastructure companies,' said CEO Francois Poirier. (TC Energy Corp.) Will help attract new investors, CEO says
Creating a pure-play natural gas and low-carbon business will help TC Energy attract new investors, Poirier said, though he emphasized that doesn't mean investors are shying away from crude oil pipelines.
"The shareholders of TC Energy today really like that (oil pipeline) business," he said.
"It's just that there's been so much growth on the gas and low-carbon side of the business.'
Under the proposed transaction, TC Energy shareholders will retain their current ownership in TC Energy's common shares and receive a pro-rata allocation of common shares in the new liquids pipelines company. The number of common shares in the new company to be distributed to TC Energy shareholders will be determined prior to the closing of the split.
The transaction is expected to be tax-free for TC Energy's Canadian and U.S. shareholders. Because that will require favourable rulings from U.S. and Canadian tax authorities, which will take some time to achieve, Poirier said, a shareholder vote on the transaction won't be held until mid-2024.
The transaction is expected to be complete by the end of 2024.