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Encana Announces Final Results of Substantial Issuer Bid


Encana Corporation today announced the final results of its substantial issuer bid (the “Offer”) under which it has accepted to purchase for cancellation 47,333,333 of its common shares (“Shares”) at a purchase price of US$4.50 per Share, for an aggregate purchase price of approximately US$213 million. Shares purchased under the Offer represent approximately 3.5% of the issued and outstanding Shares at the time that the Offer was commenced.

Based on the final count by AST Trust Company (Canada), the depositary for the Offer, a total of 127,957,593 Shares were properly tendered and not properly withdrawn. As the Offer was oversubscribed, shareholders who made auction tenders at a price of US$4.50 or less per Share and purchase price tenders will have approximately 70.69% of their successfully tendered Shares purchased by Encana (other than “odd lot” holders, whose Shares will be purchased on a priority basis). Shareholders who made auction tenders at a price in excess of US$4.50 per Share will have their Shares returned by the depositary for the Offer. Payment for the Shares accepted for purchase under the Offer will occur in accordance with the terms of the Offer and applicable law.

To assist shareholders in determining the tax consequences of the Offer, Encana estimates that for the purposes of the Income Tax Act (Canada), the paid-up capital per Share is approximately C$8.39 (or US$6.31, based on the Bank of Canada daily average foreign exchange rate as at the expiry of the Offer). Given that the estimated paid-up capital per Share amount exceeds the purchase price of US$4.50 per Share, shareholders who have sold Shares to Encana pursuant to the Offer will not be deemed to have received a taxable dividend as a result of such sale.

The “specified amount” for purposes of subsection 191(4) of the Income Tax Act (Canada) is US$4.45 (or C$5.92, based on the Bank of Canada daily average foreign exchange rate as at the expiry of the Offer).

This news release is for informational purposes only and is not intended to and does not constitute an offer to purchase or the solicitation of an offer to sell Shares.



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