BY Associated Press
Friday, February 22, 2013
2/22/13 at 2:51 AM
SandRidge opposes shareholder proposal
SandRidge Energy Inc. is urging shareholders to block an investor initiative that would restructure its board.
Oklahoma City-based SandRidge posted a letter Wednesday on its website asking shareholders to oppose a move by investor TPG-Axon Group that seeks a fresh group of people to oversee the company's operations.
The Journal Record reported that TPG-Axon released documents the day before regarding land purchases in Oklahoma and Kansas, which the investor group argued indicated a conflict of interest on the part of the company.
The papers cite land purchases across 22 counties in Oklahoma and Kansas from WCT Resources, which TPG-Axon said is improper because the entity is controlled by a family trust of SandRidge CEO Tom Ward.
The land is in the highly sought-after Mississippi Lime geological formation.
SandRidge said in the letter that if the TPG-Axon proposal is approved, board members would be picked only by the investor group. The company also said the board found no indication of impropriety in the transactions, which the board reviewed beforehand. The purchases were disclosed in public filings.
Dinakar Singh, founder of New York City-based TPG-Axon, said he's not satisfied with the board members' response thus far. TPG-Axon owns 7 percent of the company's shares.
"They've never really challenged our facts on the land acquisition," he said.
SandRidge didn't comment beyond its shareholders letter.
Linn Energy buying Berry Petroleum
Linn Energy is buying the drilling company Berry Petroleum Co. for stock worth about $2.5 billion.
Linn, a Houston-based oil and gas producer, said Thursday that the deal would broaden its presence in California, the Permian Basin, Texas and the Rockies and boost its production by 30 percent.
As part of the transaction, a Linn affiliate would issue 1.25 shares for each outstanding Berry share. That values Denver-based Berry's stock at almost $46.24 per share, a 19.8 percent premium to Berry's closing price Wednesday.
The companies value the deal at $4.3 billion including assumed debt.
Berry would be converted into a limited liability company as part of the transaction. LinnCo went public in October.
The combined company would be based in Houston.
The companies' boards unanimously approved the deal. It still needs approval from the companies' shareholders.
The acquisition is expected to close by June 30.