History
Encana, a Calgary-based producer, bought Newfield in an all-stock deal in 2019, bought back shares, then moved to redomicile in the U.S. as Ovintiv.
2004-2018: A quiet record and a big deal
The record for these years is thin. In October 2004 Encana's securities were notified for removal from listing and registration on an exchange, and in October 2009 the New York Stock Exchange certified them for listing so they could begin trading there. Nothing else major appears until late 2018. Shares on issue stood at about 736 million from 2010 through 2012 and rose only slightly to about 741 million by 2014. They then climbed to about 973 million by 2016, though the beats do not explain those rises.
On October 31, 2018, Encana agreed to buy Newfield Exploration in an all-stock deal, with each Newfield share converting into 2.6719 Encana common shares. In December it filed a registration statement to issue up to 547,430,751 shares, saying existing Encana holders would own about 63.5% after closing and former Newfield holders about 36.5%.
2019: Newfield, buybacks and a move south
Encana completed the Newfield purchase on February 13, 2019. It issued about 543.4 million new shares and paid about $5.2 million in cash for certain Newfield share units. Newfield became an indirect wholly-owned subsidiary, and two directors from Newfield's side, Steven W. Nance and Thomas G. Ricks, joined Encana's board. Shares on issue reached about 1.3 billion by the end of 2019.
Encana also pressed ahead with a $1.25 billion share buyback for 2019, to offset some of that dilution. By June 10 it had spent $1.037 billion buying about 149.4 million shares at an average of $6.94. It then planned a substantial issuer bid (a formal offer to buy shares from holders) in July for up to $213 million to complete the program. The same release said Encana had agreed with CNOOC to end its China production sharing contract, expected July 31, 2019, and had retired $500 million of 6.50% notes due May 2019 using commercial paper.
On October 31, 2019, Encana agreed to move its home base to the U.S. A new parent, Ovintiv Inc., would acquire all Encana shares one-for-one after a 1-for-5 share consolidation, so holders would receive one Ovintiv share for every five Encana shares. Ovintiv would then become a Delaware corporation with the same business, assets, liabilities, directors and officers.
December 2019: The vote ahead
On December 11, 2019, Encana filed its final proxy statement for the move. A special meeting was set for January 14, 2020 in Calgary. The board unanimously recommended a vote in favour, saying it believed the company's valuation was disconnected from U.S. peers and that U.S. status could open deeper pools of U.S. investment capital. The filing warned the reorganization might be taxable for some holders, and it still needed court and stock exchange approvals.
As of that date, over 80% of 2019 capital investment was in the U.S., and the company held large positions in the Permian, Anadarko and Montney areas. Nothing was drawn on its US$2.5 billion revolving credit facility as of March 2019. The outcome of the vote was still to come.
Written from the 10 story beats below (2004 to 6 Feb 2020), which come from the company's own announcements and filings.