Encana announces pricing of public offering of common shares
Encana Corporation (“Encana”) announced today (Sept 19) the pricing of its public offering (“Offering”) of common shares (“Shares”) of Encana. Encana agreed to sell 107,000,000 Shares at a public offering price of US$9.35 per Share for gross proceeds to Encana of US$1,000,450,000. In connection with the Offering, Encana has granted the underwriters, led by Credit Suisse Securities (Canada), Inc. and J.P. Morgan, a 30-day over-allotment option to purchase up to 16,050,000 additional Shares.
Encana intends to use approximately half of the net proceeds received from the sale of the Shares to fund a portion of its 2017 capital program. The remaining proceeds will be used to enhance Encana’s balance sheet flexibility by repaying indebtedness under its credit facilities. The majority of the 2017 capital program is expected to be allocated to growing Encana’s Permian production through increasing the number of rigs in the play, which is expected to result in approximately two times as many Permian wells on stream in 2017 as compared to 2016. The allocation of proceeds may vary depending upon numerous factors, including changes in commodity prices and increased capital efficiency.
The Offering is expected to close on or about September 23, 2016. Completion of the Offering is subject to, and conditional upon, the receipt of all necessary approvals, including approval of the Toronto Stock Exchange and the New York Stock Exchange.
The Offering is being made by means of a base prospectus and related prospectus supplements. Encana previously filed with the securities commission in each of the provinces and territories of Canada a shelf prospectus and a registration statement with the United States Securities and Exchange Commission (the “SEC”), which has become effective under the Securities Act of 1933, as amended. Prospectus supplements describing the Offering will be filed with the securities regulatory authorities in each of the provinces and territories of Canada and with the SEC. The prospectuses contain, and the related prospectus supplements will contain, important detailed information about the securities being offered. Before investing, you should read the prospectuses, the prospectus supplements and other documents filed with the securities regulatory authorities in each of the provinces and territories of Canada and the SEC for information about Encana and this Offering. Copies of the prospectuses and related prospectus supplements may be obtained: in Canada from Credit Suisse Securities (Canada), Inc., Prospectus Department (416-3524520), 1 First Canadian Place Suite 2900, P.O. Box 301, Toronto, Ontario, Canada, M5X 1C9 and in the United States from Credit Suisse Securities (USA) LLC, Prospectus Department (1-800-221-1037), One Madison Avenue, New York, New York 10010, email: newyork.prospectus@credit-suisse.com; and J.P. Morgan, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, telephone: 866-803-9204, email: prospectus-eq_fi@jpmchase.com. You may also obtain these documents free of charge by visiting the SEC’s website at www.sec.gov or SEDAR at www.sedar.com.
This news release does not provide full disclosure of all material facts relating to the securities offered. Investors should read the prospectuses, any amendments and the prospectus supplements for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.