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PROPOSED CORPORATE REORGANIZATION August 2010 Copyright © 2010, Gaz Métro Limited Partnership. All rights reserved.

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Presentation on theme: "PROPOSED CORPORATE REORGANIZATION August 2010 Copyright © 2010, Gaz Métro Limited Partnership. All rights reserved."— Presentation transcript:

1 PROPOSED CORPORATE REORGANIZATION August 2010 Copyright © 2010, Gaz Métro Limited Partnership. All rights reserved.

2 CAUTION CAUTION Implementation of the proposed structure is subject to the realization of pre-conditions, some of which are beyond the control of Gaz Métro. Gaz Métro cannot provide any assurance these conditions will be realized at the appropriate time.

3 CONTEXT On October 31, 2006, Canada’s Finance Minister, Jim Flaherty, announced the introduction of a Tax Fairness Plan starting with the 2011 fiscal year (October 1, 2010 for Gaz Métro). The basic objective of the Plan is to standardize the tax treatment of certain Canadian entities whether they be corporations, income trusts, limited partnerships or other types of organizations.

4 CONTEXT Under the present tax rules, income trusts and limited partnerships, like Gaz Métro, are not taxable. In this context, Gaz Métro distributes its net income to its Partners who pay the income taxes thereon. Effective October 1, 2010, if Gaz Métro continues to be a public partnership, it will be taxable, which means that its after-tax net income, and therefore the distributions paid to Partners, will be lower than under the present rules.

5 CURRENT STRUCTURE

6 Gaz Métro would become fully taxable after September 30, 2010 if it remained a public entity. Gaz Métro Inc. and minority holders would be equally impacted by reduction in Gaz Métro after-tax adjusted net income available for distribution CURRENT STRUCTURE 50,38%17,56%32,06% 100% Public Limited Partners Public Limited Partners 29,0% (1) Trencap : Caisse de dépôt et placement du Québec (51,11%), Fonds de solidarité FTQ (16,66%), SNC-Lavalin Inc. (11,11%), BC Investment Management Corporation (11,11%), Régime des rentes du Mouvement Desjardins (8,33%), Régime de retraite de l’Université du Québec (1,67%) 100% Gaz Métro Éole inc. 71,0% Gaz Métro inc. General Partner Gaz Métro inc. General Partner Noverco inc. Boralex inc. Trencap s.e.c. (1) Trencap s.e.c. (1) Enbridge Inc. GDF SUEZ 50 % Seigneurie Wind Power Project 50 % Other Investments Gaz Métro Limited Partnership

7 PROPOSED STRUCTURE

8 50% Seigneurie Wind Power Project 50% 29% Creation and incorporation of a new public entity (Valener) and exchange of each unit of Gaz Métro held by the public for one share of Valener. Gaz Métro becomes a private Limited Partnership. PROPOSED STRUCTURE 50,38%17,56%32,06% 100% (1) Trencap : Caisse de dépôt et placement du Québec (51,11%), Fonds de solidarité FTQ (16,66%), SNC-Lavalin Inc. (11,11%), BC Investment Management Corporation (11,11%), Régime des rentes du Mouvement Desjardins (8,33%), Régime de retraite de l’Université du Québec (1,67%) 100% 51% 49% Noverco inc. Option for the transfer at cost of 49% of Gaz Métro interest in Seigneurie Wind Power Project, within 90 days of closing of the proposed reorganization, granted to Valener 71% Gaz Métro inc. General Partner Gaz Métro inc. General Partner Boralex inc. Trencap s.e.c. (1) Trencap s.e.c. (1) Enbridge Inc. GDF SUEZ Public 29% Valener Inc. Limited Partner Valener Inc. Limited Partner Gaz Métro Éole inc. Other Investments Gaz Métro Limited Partnership

9 NEXT STEPS NEXT STEPS Implementation of the proposed structure is subject to a number of conditions, including: 1.Getting the required consents; 2.A favourable vote of the Partners (unitholders) at a meeting in September 2010; 3.Approval of the Superior Court of Québec. Expected closing by September 30, 2010

10 For all the details, see also the complete presentation "Gaz Métro’s Response to Tax Fairness Plan (SIFT rules)" available on our website www.gazmetro.com/investors Contact us Investors 514 598-3039 www.gazmetro.com/investors Media 514 598-3449 www.gazmetro.com/pressroom


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