"...nanos, gigantium humeris insidentes..."--John of Salisbury
Wednesday, June 6, 2012
As Chesapeake Contemplates Dumping Pipeline for $4 Billion, McClendon Lawyers Up With ex-SEC Hard Guy (CHK; CHKM)
CHK is trading up 3.83% at $17.65 while Chesapeake Midstream, up 2.2% yesterday it tacking on another 5.38% in early pre-market action.
First up, Bloomberg via the San Francisco Chronicle: Chesapeake Said in Talks to Sell Pipelines in $4 Billion Deal
Chesapeake Energy Corp. is in advanced talks to sell pipelines to
Global Infrastructure Partners for more than $4 billion, said two people
with knowledge of the matter.
The Oklahoma-City based energy explorer, facing a $22
billion cash-flow shortfall after natural-gas prices touched a decade
low is discussing selling its entire stake in Chesapeake Midstream
Partners LP and other pipeline assets, said the people, who spoke on
condition of anonymity because the talks are private. The negotiations
may lead to a deal within days and could also fall apart, the people
Chesapeake Midstream operates pipeline networks in
Texas, Louisiana, Pennsylvania and other gas-producing states, and had
3,953 miles (6,360 kilometers) of pipe as of March 31. The partnership
gets about 75 percent of its revenue from Chesapeake Energy, with the
remainder from energy producers such as France's Total SA and Norwegian
oil company Statoil ASA. Chesapeake Energy also owned 1,950 miles of
pipelines separate from the Midstream partnership as of Dec. 31....MORE
And from Reuters:
Exclusive: Chesapeake CEO McClendon hires ex-SEC lawyer
chief executive of Chesapeake Energy Corp. has hired a top defense
lawyer to represent him in a securities regulatory inquiry into $1.3
billion in personal loans, three people familiar with the situation
CEO Aubrey McClendon has
retained Marvin Pickholz, a partner with Duane Morris and a former
assistant director of enforcement with the U.S. Securities and Exchange
Commission. He is counseling McClendon in connection with the SEC
inquiry into loans he obtained from an investment firm doing business
with the natural gas company.
The SEC is looking into whether the loans posed a conflict of interest or should have been disclosed to shareholders.
loans from investment funds managed by EIG Global Energy Partners
enabled McClendon to participate in a special perk which awarded him as
much as a 2.5 percent interest in every well drilled by Oklahoma
City-based Chesapeake each year.
McClendon used the well stakes as collateral for the loans.
SEC launched its inquiry soon after April 18, when Reuters reported on
the loans to McClendon, who co-founded Chesapeake more than two decades
Pickholz, an aggressive and
tough-talking attorney, represented a key prosecution witness in the
trial of homemaking doyenne Martha Stewart on obstruction of justice
charges stemming from an insider trading investigation. He is also a
frequent legal commentator on television news programs....MORE