The successor company to Canada’s oldest petroleum producer announced Oct. 31 it is moving its headquarters from Calgary to Denver.
Encana corporation (whose name comes from “energy Canada” is now going to be known as Ovintiv.
The company announced its intention to establish corporate domicile in the United States. The move, which requires shareholder, stock exchange and court approval, is expected to occur in early 2020. As part of this process, the new company will rebrand under the name Ovintiv Inc.
EnCana’s most recent major presence in Saskatchewan was as operator of the Weyburn unit. In 2009, the company split into Encana and Cenovus, with Cenovus taking over the major oil plays, including the Weyburn unit. That was subsequently sold to Whitecap Resources, ending over 60 years of continual majority ownership and operation by a string of successor firms within Encana’s lineage.
“We are excited about our strategic transformation. Our company is positioned to compete in the broader markets and lead the E&P (exploration and production) industry on the road ahead,” said CEO Doug Suttles in a release. Suttles personally moved to Denver in 2018, preceding the company’s now-upcoming move to the same city.
“Over the last five-plus years, we have transformed our portfolio and our culture. We've created a high quality, liquids focused multi-basin portfolio. Our focus on innovation and efficiency is consistently delivering superior financial and operational performance. A domicile in the United States will expose our company to increasingly larger pools of investment in U.S. index funds and passively managed accounts, as well as better align us with our U.S. peers.
“The change in corporate domicile will not change how we run our day-to-day activities. However, our actions show that we will leave no stone unturned to capture the value we deeply believe exists within our equity.”
The company said as Ovintiv, it will be uniquely positioned to be a leader in the E&P industry, which is at the cusp of transformation today.
“The company is generating significant free cash flow, returning cash to its shareholders and generating industry-competitive liquids growth from its multi-basin portfolio of assets. It is this unique combination that the company believes will ultimately be differentiated by the market,” said the press release.
In co-ordination with the change in corporate domicile, a consolidation and share exchange will be completed for effectively one share of common stock of Ovintiv for every five common shares of Encana. A special meeting of Encana shareholders will be held in early 2020 to approve the name change, the share consolidation and the U.S. domicile.
Approval by two-thirds of votes cast will be required to approve the changes, as well as stock exchange and Canadian court approvals. A preliminary proxy statement/prospectus is expected to be filed with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities in early November. Following completion of the corporate redomicile and the adoption of its new name, the new company will begin trading on both the New York and Toronto stock exchanges.
