Enbridge Inc. sold its stake in a Montreal-based natural gas distributor to a unit of Caisse de depot et placement du Quebec, aiming to use the proceeds to repay debt.

A subsidiary of Canada’s biggest pipeline operator sold its 38.9 per cent share of Noverco Inc. to majority-owner Trencap LP, which is controlled by Caisse, for $1.14 billion (US$940 million) in cash, the company said in a statement.

Trencap will now fully own Energir LP, a distributor of gas and power in Quebec and Vermont. The transaction is expected to close in early 2022, with sale proceeds “initially” used to repay short-term debt, Enbridge said. “The transaction is expected to be neutral to distributable cash flow per share.”

“We’re pleased to opportunistically monetize this non-strategic financial investment in Noverco at an attractive valuation and surface this value for our shareholders,” Colin Gruending, Enbridge’s chief financial officer, said in the release.

The sale marks the latest in a string of deals among Canadian energy companies over the past year as they reel from the downturn triggered by the pandemic. Pembina Pipeline Corp. and Brookfield Infrastructure Corp. are battling for a takeover of Inter Pipeline Ltd., Canada’s fourth-largest pipeline operator, in what could become the biggest acquisition in Canadian energy in years.

Enbridge said last month that it aims to keep debt levels at 4.5 to 5 times earnings before interest, taxes, depreciation and amortization, while increasing its dividend, completing a major oil pipeline expansion project this year and expanding its renewable energy business.

The deal was announced after markets closed in Toronto. Enbridge rose 1.3 per cent to $47.77 on Monday.