Carl Icahn mulls over steps to shake up the board of SandRidge Energy after it adopts a counter poison pill.

Jacob Miramar

2017-11-29 07:42:00 Wed ET

The octogenarian billionaire and activist investor Carl Icahn mulls over steps to shake up the board of SandRidge Energy after the oil-and-gas company adopts a poison pill that aims to prevent him from scooping up more shares.

Icahn became the company's largest shareholder after he personally disclosed a 13.5% equity stake in SandRidge in November 2017. He has taken issue with the board's strategic plan to buy Bonanza Creek Energy for $750 million in cash and stock. From Icahn's perspective, this irrational deal demonstrates executive exuberance and overvaluation that would ultimately erode shareholder value.

In response, SandRidge introduces the poison pill in order to stop blockholders such as Carl Icahn and Fir Tree Partners from buying more equity stakes above the 10% threshold. Fir Tree has complained that the Bonanza deal would depart substantially from SandRidge's 2016 exit from bankruptcy because the current bid is way too high and so makes little business sense. In addition to this highly controversial poison pill, SandRidge's directors may or may not have breached any triads of fiduciary duty (good faith, loyalty, and due care) in a way that would be commensurate with the business judgment rule.

Although it is difficult to anticipate how the poison pill and its concomitant board fight will unravel over time, Icahn's race toward the top can be long and arduous. Time will tell whether his board battle proves worthy and enhances sustainable shareholder wealth creation.

 


If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.

Blog+More

President Trump approves a phase one trade agreement with China.

Joseph Corr

2020-01-01 13:39:00 Wednesday ET

President Trump approves a phase one trade agreement with China.

President Trump approves a phase one trade agreement with China. This approval averts the introduction of new tariffs on Chinese imports. In return, China s

+See More

European economic integration seems to have gone backwards primarily due to the recent Brexit movement.

Daisy Harvey

2019-10-19 16:35:00 Saturday ET

European economic integration seems to have gone backwards primarily due to the recent Brexit movement.

European economic integration seems to have gone backwards primarily due to the recent Brexit movement. Brexit, key European sovereign debt, and French and

+See More

China continues to sell U.S. Treasury bonds amid Sino-U.S. trade truce uncertainty.

Chanel Holden

2019-08-05 13:30:00 Monday ET

China continues to sell U.S. Treasury bonds amid Sino-U.S. trade truce uncertainty.

China continues to sell U.S. Treasury bonds amid Sino-U.S. trade truce uncertainty. In mid-2019, China reduces its U.S. Treasury bond positions by $20.5 bil

+See More

AYA finbuzz podcast offers fresh insights into the latest stock market topics, economic trends, and personal finance inspirations as of November 2019.

Daphne Basel

2019-11-26 11:30:00 Tuesday ET

AYA finbuzz podcast offers fresh insights into the latest stock market topics, economic trends, and personal finance inspirations as of November 2019.

AYA Analytica finbuzz podcast channel on YouTube November 2019 In this podcast, we discuss several topical issues as of November 2019: (1) The Trump adm

+See More

British Prime Minister Theresa May faces her landslide defeat in the parliamentary vote 432-to-202 against her Brexit deal.

Charlene Vos

2019-01-27 12:39:00 Sunday ET

British Prime Minister Theresa May faces her landslide defeat in the parliamentary vote 432-to-202 against her Brexit deal.

British Prime Minister Theresa May faces her landslide defeat in the parliamentary vote 432-to-202 against her Brexit deal. British Parliament rejects the M

+See More

World politics, economics, and new ideas from the Psychology of Money written by Morgan Housel

Daphne Basel

2023-10-19 08:26:00 Thursday ET

World politics, economics, and new ideas from the Psychology of Money written by Morgan Housel

World politics, economics, and new ideas from the Psychology of Money written by Morgan Housel We would like to provide both economic and non-economic th

+See More