Enbridge Inc. (NYSE: ENB) said Dec. 4 it agreed to sell its New Brunswick gas utilities business, which analysts said will add dry powder to the Calgary, Alberta-based company’s balance sheet.

Liberty Utilities (Canada) LP, subsidiary of Algonquin Power and Utilities Corp. (NYSE: AQN), agreed to acquire the assets which include Enbridge Gas New Brunswick LP and Enbridge Gas New Brunswick Inc. for C$331 million cash.

Enbridge Gas New Brunswick operates and maintains more than 1,200 km of natural gas distribution pipeline in 12 communities in southern New Brunswick, serving 12,000 customers.  

Enbridge said it expects to close the transaction in 2019, subject to the receipt of regulatory approvals and other customary closing conditions. Employees, customers, partners and suppliers of the Enbridge Gas New Brunswick franchise can expect no change to the day-to-day operations as Enbridge works with Liberty Utilities to complete the transition of operations, which it anticipates to take a number of months, according to the company release.

Analysts with Tudor, Pickering, Holt & Co. (TPH) said Enbridge remains well on track to achieve five times debt to EBITDA ratio by year-end 2018.

“Earnings impact likely immaterial, though positive to see continued progress on re-focused strategy on core business ahead of Line 3 construction set to begin in first-quarter 2019,” TPH analysts said in a Dec. 4 research note.

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Enbridge, which has been under pressure to sell noncore assets and reduce its debt, said in May 2018 it would buy its independent units including Spectra Energy Partners and Enbridge Energy Partners as well as its pipeline assets and bring them under a single listed entity.

In addition, Enbridge agreed in July to sell its Canadian natural gas gathering and processing business to Brookfield Infrastructure Partners LP and its institutional partners for about C$4.31 billion (US$3.28 billion). That particular sale, expected to close mid-2019, was part of a move to recast itself as a pipeline utility, said Enbridge CEO Al Monaco.

“The sale ... significantly advances our strategic priority of moving to a pure-play regulated pipeline and utility business model,” Monaco said.

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Following the announcement Dec. 4, Enbridge said the company remains fully committed to maintaining its ownership interest in the Maritimes and Northeast Pipeline, which serves markets in Atlantic Canada, including New Brunswick and the northeastern U.S.

Reuters contributed to this article.