TPG-Axon, which owns 6.7% of the outstanding shares of Oklahoma City-based SandRidge Energy [NYSE: SD], has sent a third letter to SandRidge’s board of directors outlining its view that the company is disregarding shareholder interests and transparency and asking the board to explore strategic alternatives to maximize value.
In the latest letter, dated Dec. 24, 2010, TPG-Axon notes that it has filed a lawsuit in Delaware Chancery Court contesting the validity of the declared Initial Consent Date noted in SandRidge’s 8-K, dated Dec. 21, 2012, relating to TPG-Axon’s proposals to amend the company’s bylaws and remove and replace members of the current board of directors.
TPG-Axon also said that it plans to file consent solicitation documents with the US Securities and Exchange Commission. TPG-Axon is seeking to replace SandRidge’s entire board of directors with a new group of directors that it believes will better serve shareholder interest. After TPG-Axon’s consent solicitation is mailed to SandRidge shareholders in early January, SandRidge shareholders of record as of Dec. 13, 2012 will have up to 60 days to submit their written consent for TPG-Axon’s proposals.
“Sadly, we are not surprised that [CEO] Tom Ward and the board of directors have resorted to shameful tricks to try and confuse shareholders and shorten the period of time in which they have to vote,” said Dinakar Singh, founder and CEO of TPG-Axon Capital. “The actions Tom and the board have taken over the past several weeks reek of desperation and clearly illustrate their complete disregard for shareholder interests and transparency. Instead of limiting shareholders’ ability to have their say, the board should be focused on exploring all strategic alternatives to maximize value.”
The letter also outlines actions taken by Ward that TPG-Axon believes directly violate his fiduciary responsibility to shareholders. Specifically, TPG-Axon has asked SandRidge’s board to either disclose its knowledge of, or investigate instances where Ward and his son, Trent Ward, through WCT Resources (an investment vehicle established by Ward for the benefit of his children) acted in advance of the company to acquire mineral rights from third parties, and then leased those rights to SandRidge just weeks and months later for a profit.
TPG-Axon Capital is a global investment firm. Through offices in New York, London, Hong Kong, and Tokyo, TPG-Axon invests across global markets and asset classes.