Icahn nominee named SandRidge chairman

Activist investor Carl Icahn’s nominees have claimed control of key leadership positions on the SandRidge Energy Inc. board, the company said Monday.

The leadership change is a result of last week’s shareholder vote that gave Icahn control of the Oklahoma City-based oil and natural gas producer. With the changes, Icahn Enterprises LP executive Jonathan Frates has been named chairman, the company said Monday.

“I am honored to be selected by my fellow board members to serve as chairman in this pivotal moment in the history of SandRidge,” Frates said in a statement Monday afternoon.

Frates has served as a managing director specializing in energy investments at Icahn Enterprises L.P. since November 2015. He previously was a senior business analyst at First Acceptance Corp. and an associate at its holding company, Diamond A Ford Corp.

Icahn nominee Randolph C. Read has been named chairman of SandRidge’s audit committee. John J. “Jack” Lipinski is chairman of the compensation committee, and Robert G. Alexander is chairman of the nominated and governance committee.

Also Monday, SandRidge said it has entered into a confidentiality agreement with Icahn. The

new directors also said Icahn told them last week he will not submit an offer in connection with the company’s ongoing strategic review process.

SandRidge’s previous board began the review process earlier this year, asking companies to submit offers to partner with or buy SandRidge or its operations. The directors earlier this month said they had entered into confidentiality agreements with 17 potential bidders, including Icahn.

Icahn has been highly critical of the process and previously said he would consider making a bid to buy the company if he gained control of the board. The previous directors earlier this month said that if Icahn gained control of the company, he could bypass the strategic review and buy the company without dealing with competitive bidders.

“If Icahn gets his way by seizing control of, or placing his nonindependent nominees on the board, he will be in a position to simultaneously run and bid for the company — putting his interests ahead of other shareholders,” the previousdirectors said on June 15.

Monday’s announcements come less than a week after shareholders voted to give Icahn control of a majority of the company’s directors. The initial count June 19 showed shareholders electing four Icahn-backed challengers — Alexander, Lipinski, Read and Jonathan Christodoro — and two incumbents — SandRidge CEO Bill Griffin and Sylvia K. Barnes. The seventh seat was considered too close to call.

Following the vote, Icahn and the company agreed to expand the board to eight directors with the addition of Ichan-backed Frates and incumbent David Kornder.

The four independent Icahn nominees elected were the candidates endorsed by independent proxy advisers Glass, Lewis & Co. and Institutional Shareholder Services Inc. Both firms recommended SandRidge directors retain a majority of the board, but they disagreed about which Icahn nominees should be elected.

Both advisory firms, however, warned shareholders against electing current or former Icahn employees.

“We are nevertheless inclined to conclude the election of any current — or, indeed, former — Icahn employees to the SandRidge board during an active solicitation in which Icahn may submit a bid would represent a clear deviation from foundational principles of sound corporate governance,” Glass Lewis said in its recommendation earlier this month.

Icahn has said his nominees would end wasteful spending and increase shareholder value.

“We cannot promise that our slate will be able to wave a magic wand and reverse overnight all the damage caused by the many disastrous decisions these directors have made,” Icahn said in an open letter to shareholders released June 18.

“However, we are completely confident that they will work tirelessly to seek to increase shareholder value in a conflictfree manner and will not act in the grand tradition of the previous directors by disregarding the interests of stockholders at every turn.”

SandRidge shares gained a penny Monday to close at $17.27 a share. The stock price is up $1.43, or 9 percent, since last week’s shareholder vote.