Encana To Acquire Newfield - Quick Facts

(RTTNews) - Encana Corpo. (ECA) and Newfield Exploration Company (NFX) announced a definitive agreement whereby Encana will acquire all of the outstanding shares of common stock of Newfield in an all-stock transaction valued at approximately $5.5 billion. Encana will also assume $2.2 billion of Newfield net debt. Newfield shareholders will receive 2.6719 Encana common shares for each share of Newfield common stock.

Upon completion of the transaction, Encana shareholders will own approximately 63.5 percent of the combined company and Newfield shareholders will own approximately 36.5 percent. Two directors from the Newfield Board of Directors will join the Encana Board upon closing.

Encana intends to raise dividend by 25 percent and expand share buyback program to $1.5 billion following closing of the transaction; funded with expected non-GAAP free cash flow and cash on hand. The transaction is expected to be immediately accretive to key elements of Encana's five-year plan including non-GAAP cash flow per share.

Separately, Encana reported third quarter net earnings of $39 million, and non-GAAP free cash flow of $66 million. The company said it is on track to generate full-year non-GAAP free cash flow in 2018, one year earlier than expected in its five-year plan.

For the third-quarter, total production was 378,200 barrels of oil equivalent per day (BOE/d), up 33 percent year-over-year. Liquids production was 178,700 barrels per day (bbls/d), up 40 percent year-over-year.