(Reuters) - SandRidge Energy Inc's SD.N biggest shareholder, Carl Icahn, called on Tuesday for the replacement of two directors and the removal of a poison pill barring individual shareholders from accumulating more than 10 percent of the U.S. shale producer's stock.
The move was the latest in the billionaire investor's dispute with the Oklahoma City-based oil and gas firm, after he successfully lobbied the company's board last month to abandon a proposed $746 million purchase of rival Bonanza Creek Energy Inc BCEI.N.
Icahn said in a letter to SandRidge Chairman John Genova that he wanted to nominate one new director, while the other would be determined by other large shareholders. Icahn did not specify which board members he would like removed, nor did he explain why he was not pushing for the entire five-person board to be replaced. bit.ly/2maIfz6
Icahn did not respond to a request to comment but he lashed out in his letter at James Bennett, SandRidge’s chief executive and director, for his leadership.
“Your apparent disregard for any semblance of accountability to the owners of SandRidge reminds me of the medieval belief in the divine right of kings,” Icahn wrote.
SandRidge said it expects to meet next week with Icahn and other large investors in the company, adding that it values “constructive shareholder dialogue.” It defended the poison pill, saying it does not bar shareholders from communicating with one another as long they did not form a group.
SandRidge, which emerged from bankruptcy last year, had billed the Bonanza Creek deal as a key growth opportunity in the Denver-Julesburg Basin of Colorado.
Icahn, SandRidge’s largest shareholder with a 13.5 percent stake in the company, had called the deal “value-destroying,” citing the large amount of stock the company would have had to issue to fund it.
Icahn demanded the company change its bylaws so that large transactions require approval from four of the five board members, rather than a simple majority and to withdraw or amend the poison pill.
SandRidge shares rose three cents to $21.09 on Tuesday.
Analysts at Coker Palmer Institutional said the muted share reaction was due to a recent run-up and the lack of direction beyond the proposed board shake-up in Icahn’s letter.
Icahn has not always been successful in agitating for change at energy companies. In 2016, his hand-picked director at Chesapeake Energy Corp CHK.N resigned in what was widely seen as a tacit admission that the investor's turnaround strategy was not working fast enough.
Reporting by Ernest Scheyder; Editing by Meredith Mazzilli and Tom Brown
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