Continental Resources shareholders voted Friday morning to approve a nearly $280 million purchase of Enid-based Wheatland Oil Co., which is owned by Continental executives Harold Hamm and Jeff Hume.
More than 99 percent of the voting shares were cast in favor of the deal.
Continental required that the sale be approved by a majority of the shares not controlled by Hamm, Hume and other directors and executives. Shares that were not voted were counted as “no” votes.
By that calculation, the sale passed with approval of more than 80 percent of the minority shares.
“I think the shareholders recognized the process that we went through and the price we negotiated with Harold and Jeff was a good price and favorable to the minority shareholders,” said Mark Monroe, the independent Continental director who led the Wheatland purchase.
The all-stock transaction is expected to close next week.
Hamm owns 75 percent of Wheatland, while Hume controls the remaining 25 percent.
Under terms of the deal, Continental will pay for Wheatland by issuing about 3.9 million shares to Hamm and Hume. At Friday's closing price of $71.72 per share, the transaction is worth just less than $280 million.
“It's a good deal for the company and a good deal for the Wheatland owners. It's a fair deal that was handled well,” Hume said. “This focuses Harold and me on Continental Resources, which was the whole intent.”
Wheatland owns a 5 percent to 10 percent interest in Continental's leasehold in parts of the Bakken field of North Dakota and Montana as well as other Continental assets in Mississippi and Oklahoma.
Hamm said the deal fits well with Continental's goal of increasing production in the Bakken.
“In the past quarter, we went against the grain of a lot of people in the area because as people pulled back when oil prices went down a bit, if we had a chance to increase our percentage in a well, we did,” he said.
“That's a big reason why we had more growth in this past quarter.”
Friday's vote was threatened by a lawsuit filed by the Louisiana Municipal Police Employees' Retirement System, which said Continental did not disclose enough information about the deal and that a trust owned by Hamm's children should not have been considered part of the minority shares.
U.S. District Judge Timothy D. DeGiusti disagreed, ruling in favor of Continental in three separate decisions over the past week.
Hamm owns more than 86 percent of Continental's shares, and his children's trust controls another 8 percent.