Encana Corp. plans to establish its corporate domicile in the United States and change its name in the process, the company said Thursday, a move that takes the oil and gas company further away from its Canadian roots.
The changes – which require shareholder, stock exchange, and court approval – are expected to take effect early next year.
In parallel with the the re-domiciling process, Calgary-based Encana will change its name to Ovintiv Inc.
"We are excited about our strategic transformation,” CEO Doug Suttles said in a release. “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.”
Suttles added the move would not change how the company runs its 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," he said.
SIA Wealth Management Chief Market Strategist Colin Cieszynski said the name change is a clear signal about where the company sees itself heading.
“The change in domicile itself … that’s more of a legal thing. To me, the bigger issue is the name change,” he said. “Encana, when it came out about 20 years ago, was a shortened term for energy in Canada. Well now you’re taking Canada right out of it. So that to me is a pretty big statement about where they think they’re going.”
The company said a preliminary prospectus is expected to be filed with Canadian and U.S. securities regulatory authorities in early November, and a special shareholder meeting will be held in early 2020 to vote on the changes, which will require two-thirds approval.
Once the new company is approved, it will trade on both the New York Stock Exchange and Toronto Stock Exchange under the ticker symbol “OVV.”
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October 31, 2019 at 06:46PM
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