SandRidge Energy Inc.’s (NYSE: SD) plan to pay $746 million for Bonanza Creek Energy Inc. (NYSE: BCEI) may have hit an impassable roadblock: roughly 28% of the company’s shareholders have vowed to vote down the merger.
The most recent opponent of the deal was activist investor Carl Icahn, who on Nov. 24 disclosed his companies own 13.5% of SandRidge’s stock and scolded SandRidge for entering a “seemingly ill-advised, dilutive and value-destructive acquisition and why they believe the transaction is anything more than an entrenchment technique.”
Mizuho energy analyst Tim Rezvan has already written off the deal, saying in a Nov. 27 report that his firm has stripped the acquisition from its models for SandRidge due to “activists’ noise” creating deal uncertainty.
“Given four owners controlling 27.6% of SandRidge shares have voiced opposition to the Bonanza Creek acquisition, we strip the acquisition from our model” and have reverted back to an earlier standalone company model. “We acknowledge the merits of SandRidge’s shareholders’ opposition to the merger.”