SandRidge Energy Inc. has been contacted by 17 potential buyers, with activist investor Carl Icahn among them, the oil and gas producer announced June 15. One of the bidders, however, accused SandRidge of mischaracterizing the nature of their negotiations.
SandRidge said it has provided the suitors with access to its data as negotiations continue. The company said its first public bidder, Midstates Petroleum Co. Inc. has made the most progress toward an agreement.
"After negotiating with Midstates Petroleum ... for over a month, Midstates has been offered a form of confidentiality agreement with terms more favorable than any other participant," SandRidge said. "To date, Midstates continues to reject both reasonable terms of non-disclosure and participation in the process."
In a statement of its own, Midstates said SandRidge had not been truthful in the way it described the negotiations.
"While SandRidge has offered a non-disclosure agreement to Midstates, it would require Midstates to enter into a standstill, which is an unusual requirement for a party that has made a public offer," Midstates said. "Furthermore, SandRidge has informed Midstates that it will not provide Midstates with internal forecasts that it is providing other process participants even if Midstates were to sign the NDA offered by SandRidge."
Midstates went on to say that another SandRidge statement, released June 4, was also inaccurate. In that statement, SandRidge said it had sought to engage in negotiations with Midstates regarding its proposal but was "rebuffed."
"Although Midstates encouraged SandRidge to make a counteroffer to our proposal, SandRidge refused and rejected our offer," Midstates said.
Icahn, who holds 13.6% of SandRidge's stock, has been on the offensive against the company's leadership and board of directors for months. He helped force out the company's former CEO and CFO, and he has assembled a full slate of director nominees in the hope that shareholders will oust the five incumbents. SandRidge has already agreed to seat two of Icahn's nominees, expanding the board to seven members.
After Icahn publicly criticized SandRidge's leadership, the company shot back, saying its largest shareholder has a track record of running energy companies into the ground and wants to buy the company without competition.
"Icahn's objective has been clear: he is seeking to place his interests above those of other SandRidge shareholders," the company said in a statement. "If Icahn gets his way by seizing control of, or placing his non-independent nominees on the board, he will be in a position to simultaneously run and bid for the company — putting his interests ahead of other shareholders."