S&P rates Inter Pipeline notes BBB-

S&P said it assigned a BBB- rating to Inter Pipeline Ltd.'s C$750 million 6 7/8% fixed- to floating-rate subordinated notes series 2019-A due March 2079.

The proceeds will be used to fund capital projects, repay debt under its revolving credit facility and finance other general corporate purposes, the agency said.

While the subordinated notes are due in 60 years, the interest margins on the notes will increase by 25 basis points in 2029 when the interest rate resets from fixed- to floating- and a further 75 bps in 2049, S&P said.

In line with the agency's criteria, the notes will receive minimal equity content after the first call date in 2029 because the remaining period until their effective maturity will be less than 20 years.

The BBB+ long-term issuer credit rating and negative outlook on the company are unchanged.

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