Investment firm TPG-Axon Capital intends to enlist other SandRidge Energy Inc. shareholders in its quest to restructure the Oklahoma City-based oil company's leadership.
“We would emphasize and reiterate that the time has come for change, and for a focus on delivering shareholder value,” TPG-Axon CEO Dinakar Singh said. “We continue to believe that SandRidge stock is dramatically undervalued, and that a sensible restructuring or sale of the company could provide dramatic upside for shareholders.”
The investment firm sent its second letter to SandRidge's board of directors on Friday, seeking to have the company restructured or sold to restore shareholder value.
SandRidge confirmed Friday it had received the latest letter from TPG-Axon.
“We've received the letter and are reviewing it,” spokesman Greg Dewey said. “As we've said previously, we are in regular dialogue with our investors and focused on improving performance and building value for our shareholders.”
TPG-Axon, which owns 6.5 percent of SandRidge's outstanding stock, sent its first letter on Nov. 8 calling for CEO Tom Ward and the company's board to be replaced.
Mount Kellet Capital Management LP, which owns 4.5 percent of SandRidge's stock, issued a similar call a week later.
The investment firm contends the stock should be trading about $20 a share.
SandRidge closed Friday at $5.85 a share, up 18 cents.
TPG-Axon blames poor management for SandRidge being undervalued, despite its significant asset base.
“SandRidge stock has declined almost 80 percent from its IPO (initial public offering) level in 2007, and is the single worst performing energy stock over that period in the Russell 1000 index,” Singh wrote.
We would emphasize and reiterate that the time has come for change, and for a focus on delivering shareholder value.”