Chesapeake Energy Corp. is under new management, but no one knows where the beleaguered company's new leadership will take it next.
The Oklahoma City energy company on Thursday announced five new directors, shifting control of the company's future away from its founder and into the hands of its largest shareholders.
Morningstar analyst Mark Hanson questioned whether the age of the new directors indicates a plan to sell the company.
New Chairman Archie Dunham is 73. Bob Alexander, 78, is just two years away from the board's mandatory retirement age. The average age of the five new directors is 67.
“Given Dunham's age, we're left wondering if his appointment doesn't signal a significant transaction of some kind in the near future — whether an outright sale of the company or perhaps a split into a few different assets that could be affected in short order and would then allow Dunham to step down with mission accomplished,” Hanson said.
Oppenheimer analyst Fadel Gheit said the new directors have been selected to make changes at Chesapeake, but it is still unclear exactly what shareholders — led by Southeastern Asset Management — are looking for.
“Is Chesapeake going to still be a going concern? Is Chesapeake going to be a much smaller company? Is Chesapeake going to be acquired by another company? Southeastern has made it clear that Chesapeake has strong assets, but at the end of the day, they have made it clear that all options are on the table, including the sale of the company,” Gheit said.