One of SandRidge Energy Inc.'s largest shareholders is asking the company's board to commission an independent investigation into “serious” allegations against CEO Tom Ward.
Mount Kellett Capital Management, which called for Ward's ouster in November, said Thursday that Ward should be suspended as the company's chief executive while an independent law firm and forensic accounting company investigates allegations that a trust purportedly run by Ward's son, Trent, persistently secured mineral rights from third parties and then sold them to SandRidge or other companies, often retaining a stake in future wells.
“If true, these allegations may constitute a breach of Mr. Ward's noncompete obligations to the company and ‘cause' for terminating Mr. Ward,” wrote Jonathan Fiorello, Mount Kellett's chief operating officer. “Pending completion of the investigation, Mr. Ward should be suspended from serving as chairman and chief executive officer of the company.”
Mount Kellett owns 22.2 million shares, or about 4.5 percent, of SandRidge's outstanding stock. The stock was up 20 cents, or 3 percent, Thursday to $6.99 a share.
Another SandRidge shareholder, TPG-Axon Capital, has raised allegations of “front-running” by Ward and his son as it pushes for new management at the company, but the company maintains it has done nothing wrong.
“SandRidge has disclosed related-party transactions in the company's public filings, as appropriate,” spokesman Greg Dewey said Thursday.