--SandRidge Energy agrees to sell its Permian Basin assets for
$2.6 billion
--The sale price for the assets is higher than some analysts had
expected
--The deal is expected to close in the first quarter of 2013
SandRidge Energy Inc. (SD) said Wednesday it has struck a deal
to sell its Permian Basin assets for $2.6 billion to privately held
Sheridan Production Partners II.
Oklahoma City-based SandRidge said it will use the proceeds of
the sale to reduce debt and fund development in the Mississippian
Lime Play, an emerging unconventional field in Oklahoma and Kansas.
The selling price beat or came in on the high side of analyst
expectations.
Canaccord analysts, one of the most upbeat on potential
proceeds, expected SandRidge's Permian assets to sell for at most
$2.5 billion.
"The timing and price are quite good," said Neal Dingmann, an
analyst with SunTrust.
The move comes as SandRidge's management faces shareholder
strife, with some investors calling for a shake-up of its
leadership and a possible sale. These investors have criticized the
company's spending and debt levels.
SandRidge's Permian assets produced about 24,500 barrels of oil
equivalent a day by the end of the third quarter. The company said
the sale, which is expected to close in the first quarter of 2013,
will exclude assets associated with SandRidge Permian Trust
(PER).
SandRidge Chief Executive Tom Ward said the proceeds will bring
the company's cash balance to nearly $3 billion. "With the sale of
the Permian assets, we will significantly reduce our debt balances
and, with our ample cash and liquidity, be very well positioned to
fund our capital expenditures through 2014 and deliver significant
value to stockholders," Mr. Ward said in a press release.
-Ben Lefebvre contributed to this story
Write to Angel Gonzalez at angel.gonzalez@dowjones.com
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