CALGARY (660 NEWS) – Encana Corporation has announced its intention to move to the United States.
The move, which requires shareholder, stock exchange and court approval, is expected to take place in early 2020.
As part of this process, the company will rebrand under the name Ovintiv Inc.
The Calgary-based company says a corporate domicile in the United States will expose it to increasingly larger pools of investment in U.S. index funds and passively managed accounts, as well as better align it with its U.S. peers.
The company also plans a share consolidation that will see shareholders receive one share of Ovintiv for every five common shares of Encana.
Encana CEO Doug Suttles says the change in a corporate domicile will not change how the company runs its day-to-day activities.
The change came as Encana announced a third-quarter profit of $149 million or 11 cents per share, up from a profit of $39 million or four cents per share a year ago.
BREAKING NEWS: @encana is changing things up, changing their name to 'Ovintiv,' changing their logo, and moving their domicile to the U.S. The move is expected in early 2020, it's subject to approval from shareholders, regulators, and the courts. #yyc #energy @660NEWS pic.twitter.com/R8by3yz7a5
— Saif Kaisar (@StaySaif) October 31, 2019
A spokesperson with Encana said they’re technically just registering as a U.S. company and the move is basically just a piece of paper in Delaware.
Steve Campbell said it’s the next steps necessary to grow the company adding employees will embrace this news.
“All of our employees are stockholders and our number one obligation is to increase the value of the equity for our employees and our shareholders.”
Campbell goes on to say Encana employs 2,500 people and no jobs, including Calgary ones, will be affected by the move.
“We think the opportunity for Encana to enhance its long term value will be better reflected in the U.S. markets that are larger, have more liquidity and provide us to more passive money which is really the trend in investment today.”
With files from The Canadian Press