SandRidge Energy's (NYSE: SD) management is under attack by TPG-Axon Capital, one of the company's largest shareholders. The hedge fund published a letter today stating its intent on changing the company's board as well as replacing top management in an attempt to boost the deeply valued share price of the oil and gas junior.
TPG-Axon argues that SandRidge's deplorable stock price is directly related to management's incoherent strategy and unscrupulous spending in addition to having a CEO who is unconscionably compensated for massive underperformance. TPG also points to SandRidge's past acquisitions and states that the company's "early focus was wrong in general" with regard to its focus on acquiring natural gas assets.
In this video, Fool.com analyst Joel South disagrees with TPG's assessment with regard to management's past acquisitions as well as the company's current strategy. While more oversight and independent board members are always welcome, Tom Ward's three-year plan to profitability is well-constructed and firmly in place.
This debate will be ongoing, but SandRidge's current management can defend its honor after the markets close while it releases its third-quarter earnings.
Joel South has no positions in the stocks mentioned above. Taylor Muckerman has no positions in the stocks mentioned above. The Motley Fool owns shares of ExxonMobil and has the following options: long JAN 2013 $16.00 calls on Chesapeake Energy, short JAN 2014 $15.00 puts on Chesapeake Energy, long JAN 2014 $20.00 calls on Chesapeake Energy, and long JAN 2014 $30.00 calls on Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.