Enbridge and Spectra Energy have signed an agreement for a stock-for-stock merger transaction after a unanimous approval by the board of directors.

This deal values Spectra Energy's common stock at approximately $28bn, based on the closing price of Enbridge's common shares on 2 September. The merger will produce one of the largest energy infrastructure companies in North America, based on a pro-forma enterprise value of around $127bn.

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Enbridge's president and CEO Al Monaco said: "Over the last two years, we've been focused on identifying opportunities that would extend and diversify our asset base and sources of growth beyond 2019.

 "We are accomplishing that goal by combining with the premier natural gas infrastructure company to create a true North American and global energy infrastructure leader. This transaction is transformational for both companies and results in unmatched scale, diversity and financial flexibility with multiple platforms for organic growth."

"This transaction is transformational for both companies and results in unmatched scale, diversity and financial flexibility with multiple platforms for organic growth."

Spectra Energy's president and CEO Greg Ebel said: "The combination of Enbridge and Spectra Energy creates what we believe will be the best, most diversified energy infrastructure company in North America, if not the world. This is an incredible opportunity for both companies and we at Spectra Energy could not be more excited about what it means going forward.

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"Together, the merged company will have what we believe is the finest platform for serving customers in every region of North America and providing investors with the opportunity for superior shareholder returns."

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The merger is expected to close in Q1 of 2017, following shareholder and regulatory approvals, as well as other customary conditions.

Shareholders of Spectra Energy will receive 0.984 shares of the combined company for each share of Spectra Energy common stock they own. Enbridge shareholders will own approximately 57% of the combined company, with Spectra Energy shareholders owning the remaining 43%. 

The combined entity will be called Enbridge Inc and Ebel will become chairman. It will have a diverse set of assets including crude oil, liquids, and natural gas pipelines, terminal and midstream operations, a regulated utility portfolio, and renewable power generation.