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CHK - Chesapeake Energy

bmichaud

By bmichaud
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nkp007 Newbie

nkp007

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I used data from the September 30, 2012 10Q.

 

$45B in total assets (many argue this number is very understated)

$28B in total liabilities

$17B in total equity

 

I assume in a bad, bad case, $10B in equity. @ 769mm diluted outstanding shares, that's $13 per share in value after taking some ruthless writedowns.

 

 

 

 

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fareastwarriors Newbie

fareastwarriors

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oh wow

 

 

Chesapeake Energy Corporation today announced that its Co-founder, Chief Executive Officer and President, Aubrey K. McClendon, has agreed to retire from the company on April 1, 2013 and will continue to serve as Chief Executive Officer until his successor is appointed. Mr. McClendon, 53, has served as Chesapeake's Chief Executive Officer since the inception of the company in 1989 and served as Chairman of the Board from its founding until 2012.

 

 

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txlaw Newbie

txlaw

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This is very big news.  Good on Aubrey and the board.

 

Gotta quote myself on this one from earlier in the thread:

 

I keep going back and forth on whether or not to keep him.  On the one hand, nobody can promote and do deals like McClendon, so we kind of need him to work his butt off to get these asset sales done at the best possible prices for CHK shareholders.  On the other hand, if he pulls this off without having to sell the entire company, then we're left with a CEO who isn't necessarily useful for harvest mode and that may be hard to keep from getting into trouble.

 

Probably the best thing for McClendon to do for CHK shareholders would be to tell the market that he will: (1) shepherd CHK through the necessary asset sales and shift from mostly dry gas to wet gas, and (2) step down to be replaced with an outside CEO once the harvest era begins.

 

Then maybe McClendon could  concentrate on some other nat gas related ventures that would benefit CHK and the industry.  Or he could be an industry spokesperson or lobbyist in DC or abroad.  We have to give him some way to redeem himself because I think he might be game for trying to do so.

 

It would be nice to see the asset sales set in stone before he leaves.

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Parsad Newbie

Parsad

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This is very big news.  Good on Aubrey and the board.

 

Gotta quote myself on this one from earlier in the thread:

 

I keep going back and forth on whether or not to keep him.  On the one hand, nobody can promote and do deals like McClendon, so we kind of need him to work his butt off to get these asset sales done at the best possible prices for CHK shareholders.  On the other hand, if he pulls this off without having to sell the entire company, then we're left with a CEO who isn't necessarily useful for harvest mode and that may be hard to keep from getting into trouble.

 

Probably the best thing for McClendon to do for CHK shareholders would be to tell the market that he will: (1) shepherd CHK through the necessary asset sales and shift from mostly dry gas to wet gas, and (2) step down to be replaced with an outside CEO once the harvest era begins.

 

Then maybe McClendon could  concentrate on some other nat gas related ventures that would benefit CHK and the industry.  Or he could be an industry spokesperson or lobbyist in DC or abroad.  We have to give him some way to redeem himself because I think he might be game for trying to do so.

 

It would be nice to see the asset sales set in stone before he leaves.

 

You pretty much nailed that on the head Tx!  Cheers!

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fareastwarriors Newbie

fareastwarriors

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This is very big news.  Good on Aubrey and the board.

 

Gotta quote myself on this one from earlier in the thread:

 

I keep going back and forth on whether or not to keep him.  On the one hand, nobody can promote and do deals like McClendon, so we kind of need him to work his butt off to get these asset sales done at the best possible prices for CHK shareholders.  On the other hand, if he pulls this off without having to sell the entire company, then we're left with a CEO who isn't necessarily useful for harvest mode and that may be hard to keep from getting into trouble.

 

Probably the best thing for McClendon to do for CHK shareholders would be to tell the market that he will: (1) shepherd CHK through the necessary asset sales and shift from mostly dry gas to wet gas, and (2) step down to be replaced with an outside CEO once the harvest era begins.

 

Then maybe McClendon could  concentrate on some other nat gas related ventures that would benefit CHK and the industry.  Or he could be an industry spokesperson or lobbyist in DC or abroad.  We have to give him some way to redeem himself because I think he might be game for trying to do so.

 

It would be nice to see the asset sales set in stone before he leaves.

 

You pretty much nailed that on the head Tx!  Cheers!

 

Agreed, very good call.

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txlaw Newbie

txlaw

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Posted

This is very big news.  Good on Aubrey and the board.

 

Gotta quote myself on this one from earlier in the thread:

 

I keep going back and forth on whether or not to keep him.  On the one hand, nobody can promote and do deals like McClendon, so we kind of need him to work his butt off to get these asset sales done at the best possible prices for CHK shareholders.  On the other hand, if he pulls this off without having to sell the entire company, then we're left with a CEO who isn't necessarily useful for harvest mode and that may be hard to keep from getting into trouble.

 

Probably the best thing for McClendon to do for CHK shareholders would be to tell the market that he will: (1) shepherd CHK through the necessary asset sales and shift from mostly dry gas to wet gas, and (2) step down to be replaced with an outside CEO once the harvest era begins.

 

Then maybe McClendon could  concentrate on some other nat gas related ventures that would benefit CHK and the industry.  Or he could be an industry spokesperson or lobbyist in DC or abroad.  We have to give him some way to redeem himself because I think he might be game for trying to do so.

 

It would be nice to see the asset sales set in stone before he leaves.

 

You pretty much nailed that on the head Tx!  Cheers!

 

Yeah, I'm patting myself on the back for that one.  ;D

 

I think we all know that SEAM and Lou Simpson are no dummies and are protecting all shareholders' interests.

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ericd1 Newbie

ericd1

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WSJ News Alert...

 

Chesapeake CEO Aubrey McClendon to Retire

Chesapeake Energy said its co-founder and chief executive Aubrey McClendon will retire from the company April 1.

Mr. McClendon will step down even though Chesapeake says a review of his business dealings has not revealed improper conduct.

Chesapeake Chairman Archie Dunham said in a statement the company needs a new leader to help develop the oil and gas assets the company has amassed under Mr. McClendon.

 

 

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Parsad Newbie

Parsad

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WSJ News Alert...

 

Chesapeake CEO Aubrey McClendon to Retire

Chesapeake Energy said its co-founder and chief executive Aubrey McClendon will retire from the company April 1.

Mr. McClendon will step down even though Chesapeake says a review of his business dealings has not revealed improper conduct.

Chesapeake Chairman Archie Dunham said in a statement the company needs a new leader to help develop the oil and gas assets the company has amassed under Mr. McClendon.

 

A little slow eric.  ;D  Cheers!

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fareastwarriors Newbie

fareastwarriors

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Chesapeake Reports Findings of CEO Probe .

 

http://professional.wsj.com/article/SB10001424127887323549204578315970187656826.html?mod=WSJPRO_hpp_LEFTTopStories

 

 

Chesapeake Energy Corp. CHK 0.00%said a wide-ranging board probe of departing Chief Executive Aubrey McClendon's financial dealings found "no intentional misconduct."

 

The probe, under way since April, covered Mr. McClendon's personal financial transactions stretching back to at least 1998, including his practice of borrowing from firms that do business with Chesapeake.

 

The review "did not reveal any improper benefit to Mr. McClendon or increased cost to the company as a result in the financial relationships," the company said in a written statement Wednesday. The board was assisted by independent law firm Locke Lord LLP, according to people familiar with the matter, in the review of millions of pages of documents. A spokesman for Mr. McClendon said he declined to comment.

 

Separately, Chesapeake said a board review concluded that the company didn't violate antitrust laws with its 2010 leasing activities in Michigan, which have been the focus of an inquiry by the U.S. Department of Justice.

 

The release of the probe's results marks the company's latest effort to move beyond controversies over the board's oversight of Mr. McClendon, who co-founded Chesapeake in 1989. The company reiterated that the findings aren't related to Mr. McClendon's planned April 1 departure from the company, announced last month.

 

Mr. McClendon, 53 years old, drew criticism from shareholders after revelations last spring that he borrowed more than $1 billion from firms that did business with Chesapeake. The borrowings helped him participate in a controversial perk, in which he had the option to take a small stake in every well Chesapeake drilled as long as he paid his share of the costs.

 

But to pay for the costs, Mr. McClendon took out loans that were secured by his well interests, the extent of which was first reported in April by Reuters. The Wall Street Journal found that Mr. McClendon had struck agreements for loans of as much as $1.4 billion from EIG Global Energy Partners while the private-equity group was negotiating to invest hundreds of millions of dollars in a Chesapeake venture.

 

In response to the revelations, Chesapeake's board said that it was "generally aware" that Mr. McClendon had borrowed against his well interests but hadn't reviewed specific transactions. It initiated a probe of the CEO's financial ties to "any third party that has had or may have a relationship with the company in any capacity."

 

The board drew criticism from investors who felt it hadn't done enough to rein in Mr. McClendon. In response, Chesapeake has initiated a raft of governance changes, including slashing board-member pay.

 

In June, Chesapeake replaced a majority of the board with directors selected by its two largest shareholders, Southeastern Asset Management Inc. and activist investor Carl Icahn.

 

Another director, V. Burns Hargis, offered to step down from Chesapeake's board after failing to receive a majority of shareholder votes at the annual meeting in June. But the board exercised its authority to keep him on until the probe was complete. Mr. Hargis chaired the audit committee that led the probe, and the board has said it would revisit his offer to resign after the inquiry was finished. Mr. Hargis declined to comment Wednesday.

 

Southeastern, which holds about 13% of Chesapeake's shares, in June called on the company to wrap up the probe of Mr. McClendon in "weeks not months." Southeastern also declined to comment Wednesday.

 

Despite Mr. McClendon's scheduled departure, it might be some time before Chesapeake can put the governance controversies to rest. It faces lawsuits over the issue and a probe by the U.S. Securities and Exchange Commission.

 

 

 

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fareastwarriors Newbie

fareastwarriors

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.Chesapeake Energy Profit Tumbles on Wrong-Way Natural Gas

 

http://www.bloomberg.com/news/2013-02-21/chesapeake-energy-profit-tumbles-on-wrong-way-natural-gas.html

 

 

Chesapeake Energy Corp. (CHK), which yesterday cleared its outgoing chief executive officer of misconduct after a 10-month probe into his personal finances, said fourth-quarter profit dropped on wrong-way bets on the price of natural gas.

 

Net income fell to $300 million, or 39 cents a share, from $472 million, or 63 cents a share a year earlier, the Oklahoma City-based oil and gas explorer said in a statement today. Excluding certain one-time gains and losses, Chesapeake said it earned 26 cents a share. It had been expected to post adjusted per-share profit of 14 cents, based on the average of 32 analysts’ estimates compiled by Bloomberg.

 

Chesapeake received an average $2.07 per thousand cubic feet of gas during the final three months of 2012, a 47 percent decrease from a year earlier, according to the statement. The company failed to fully capitalize on the first increase in average quarterly gas prices in more than a year because of hedging contracts that locked about three-fourths of its gas output into below-market prices.

 

...

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