Another Equal Energy Ltd shareholder is raising objections to its proposed $230 million sale.
Montclair Energy LLC, which failed in its bid to buy the Oklahoma City company earlier this year, said the offer by Tulsa-based Petroflow Energy Corp. is “wholly inadequate.”
“As long-suffering shareholders of Equal Energy, we have for some time recognized that the market has undervalued the company,” said Chip Hazelrig, a Montclair principal. “However, we know that our fellow shareholders are patient investors who are willing to support changes that will restore the value of the company's shares and give them the opportunity to realize the full potential value of their investment.”
Petroflow has offered to buy all outstanding shares of Equal for $5.43 each in a deal that will total about $230 million.
Equal officials could not be reached for comment on Monday.
Alabama-based Montclair echoed concerns raised last week by fellow Equal shareholder Lawndale Capital Management, which contends shareholders could be in line for a bigger payday if the company improves its operational efficiency.
“Shareholders should not have to sell out in a transaction that undervalues the company,” Hazelrig said. “Like Lawndale, we are prepared to reject the Petroflow transaction in favor of restoring more astute managers who can maximize the value of the company's Hunton properties and take the right steps with the company's balance sheet.”