RE:ENB announces a $2.75 billion equity "at the market" raiseObscure…a few thoughts
As I mentioned before here and on the ENB Board, ENB was assuming considerable short term debt with acquisition. At the time I suggested that ENB was counting on interest rate cuts by the Fed which was the prevailing view at the time. Now most analysts and indeed Powell himself is not expecting this to happen.
This places the math for the acquisitions in a different light. I suspect that either way - debt or equity will make the acquisition less accretive at least in the short run. Seems like ENB management has decided equity is the best course if action. Based on this I can see the SP for ENB staying down longer than you might expect based on past history because the situation in my view is a bit different now.
Turning to ENS, given that is trading at or slightly below NAV, I expect that it will fare better in terms of the SP. If it doesn't then to me it will be a price inefficiency that would be inclined to take advantage of.