South Bow Recommends Shareholders Reject TRC Capital's Below-market "Mini-tender" Offer

Rhea-AI Summary

South Bow Corp (TSX & NYSE: SOBO) warns shareholders about an unsolicited mini-tender offer from TRC Capital Investment Corp. to purchase up to 3 million common shares (1.4% of outstanding shares) at C$31.95 per share. The offer price represents a 4.6% discount to the Oct. 28 closing price and a 7.4% discount to the Nov. 1 closing price. South Bow strongly recommends shareholders reject this below-market offer and exercise caution, noting that mini-tender offers typically avoid many investor protections required by Canadian and U.S. securities laws.

Positive

• None.

Negative

• Unsolicited mini-tender offer attempts to acquire shares below market value
• Offer price represents a 4.6% discount to Oct. 28 closing price
• Offer price represents a 7.4% discount to Nov. 1 closing price
• Potential risk to shareholders who might tender shares without understanding the below-market pricing

News Market Reaction – SOBO

-2.47%

-2.47% Session move

In the trading session that priced this news, SOBO declined 2.47%, reflecting a moderate negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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CALGARY, Alberta, Nov. 01, 2024 (GLOBE NEWSWIRE) -- South Bow Corp. (TSX & NYSE: SOBO) has received an unsolicited "mini-tender" offer from TRC Capital Investment Corp. (TRC Capital) to purchase up to 3 million South Bow common shares, or approximately 1.4% of South Bow's outstanding common shares, at a below-market price of C$31.95. South Bow does not endorse TRC Capital's unsolicited offer, has no affiliation with TRC Capital or its offer, and does not recommend or endorse this unsolicited mini-tender offer.

South Bow cautions shareholders that the mini-tender offer has been made at a below-market price for the South Bow common shares. TRC Capital’s unsolicited offer price of C$31.95 per share represents a discount of 4.6% to the closing price of the South Bow common shares on the Toronto Stock Exchange and the New York Stock Exchange on Oct. 28, 2024, the last trading day before the mini-tender offer was commenced, and a discount of 7.4% to the closing price on Nov. 1, 2024.

Shareholders are urged to obtain current market quotations for their shares, consult with their broker or financial advisor, and exercise caution with respect to TRC Capital’s unsolicited offer. Shareholders who have already tendered their shares should consider taking actions to withdraw them, including reviewing the withdrawal procedures in TRC Capital's offering documents.

TRC Capital has made similar unsolicited mini-tender offers for shares of other public companies. Mini-tender offers are designed to avoid many investor protections like disclosure and procedural requirements applicable to most take-over bids and tender offers under Canadian and U.S. securities laws. The Canadian Securities Administrators (CSA) and the U.S. Securities and Exchange Commission (SEC) have expressed concerns about mini-tender offers, including the possibility that investors might tender to such offers without understanding the offer price relative to the actual market price of their securities.

The SEC states that “bidders make mini-tender offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price.” The SEC has published investor tips about mini-tender offers, which can be found at www.sec.gov/investor/pubs/minitend.htm.

Brokers, dealers, and other market participants are encouraged to exercise caution and review the letter regarding broker-dealer mini-tender offers dissemination and disclosures at www.sec.gov/divisions/marketreg/minitenders/sia072401.htm.

Comments from the CSA on mini-tender offers can be found at http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_19991210_61-301.jsp.

South Bow requests that this news release be included in any distribution of materials relating to TRC Capital’s mini-tender offer for South Bow common shares.

About South Bow

South Bow safely operates 4,900 kilometres (3,045 miles) of crude oil pipeline infrastructure, connecting Alberta crude oil supplies to U.S. refining markets in Illinois, Oklahoma, and the U.S. Gulf Coast through our unrivalled market position. We take pride in what we do – providing safe and reliable transportation of crude oil to North America's highest demand markets. Based in Calgary, Alberta, South Bow is the spinoff company of TC Energy, with Oct. 1, 2024 marking South Bow's first day as a standalone entity. To learn more, visit www.southbow.com.

Contact information

Investor Relations	Media Relations
Martha Wilmot	Katie Stavinoha
investor.relations@southbow.com	communications@southbow.com

FAQ

What is TRC Capital's offer price for South Bow (SOBO) shares in their mini-tender offer?

TRC Capital is offering C$31.95 per share for South Bow common shares, which is below market value.

How many shares is TRC Capital attempting to purchase from South Bow (SOBO)?

TRC Capital is attempting to purchase up to 3 million South Bow common shares, representing approximately 1.4% of outstanding shares.

What is South Bow's (SOBO) recommendation regarding TRC Capital's mini-tender offer?

South Bow strongly recommends shareholders reject TRC Capital's unsolicited mini-tender offer and exercise caution due to its below-market pricing.

How much below market value is TRC Capital's offer for South Bow (SOBO) shares as of Nov. 1, 2024?

TRC Capital's offer represents a 7.4% discount to South Bow's closing price on November 1, 2024.