EnCana denies rumors of takeover talks

Petroleum News

EnCana issued a statement Oct. 20, repudiating rumors that it is in takeover talks. The company said it was not in negotiations with any party and isn’t aware of any intentions of offers.

The company’s board of directors “believe that EnCana’s continued independence is the best way to create long-term value for shareholders,” the Calgary-based independent said.

EnCana’s statement was likely triggered by the Oct. 20 issue of Globe and Mail which carried a story, citing unnamed sources, that EnCana rejected an offer for as much as $65 a share from Royal Dutch Shell Plc. The Toronto daily newspaper said Shell was considering offering $70 a share, again without citing a source for the information.

“When EnCana Chairman David O’Brien and I announced the creation of EnCana Corporation three and a half years ago, our vision was to build a flagship, Canadian-headquartered energy company that would be one of the strongest in our industry. The name EnCana was chosen from the words ‘energy Canada.’ Since that time, investors have realized a total shareholder return of approximately 200 percent as employees delivered top-tier production and reserves growth. EnCana has taken an important place in North American’s energy supply, and has become a symbol of Canadian innovation and competitiveness. Today, EnCana is extraordinarily well positioned to continue to create long-term shareholder value while delivering on our corporate mission of providing Energy for People,” Gwyn Morgan, EnCana’s president & chief executive officer, said in the Oct. press release.

Shares fall on news

“Prior to the announcement, shares traded as high as C$64.90. The stock, which jumped yesterday (Oct. 19) almost 10 percent on speculation of a takeover, has climbed 67 percent this year,” Bloomberg reported.