A huge change for an oil and gas giant
Yesterday we unexpectedly got word from Canada’s largest oil and gas company that it will split.
Encana will be dividing into two companies, one that focuses on oil and the other on natural gas.
This is great news for shareholders because for every one Encana stock they’ll get one stock in each new company. That means if they hold onto their stock and get past the initial start up costs, they could be rolling in the cash.
Is it good for the company though? The analysts scream in unison…”YES!” Having two specialty companies is a better route because they will be able to grow further than the divisions could under Encana.
This news is huge because it means a restructuring of one of the most famous names in the energy business and one analyst is predicting that other companies will follow suit. That could mean further changes, and by the end of it all the oil and gas sector is going to look a lot different.
The only thing I regret about all of this, is that I didn’t pick up Encana stock when the buying time was right.