Chesapeake officials call buyout unlikely
October 20, 2008
Company officials at publicly-traded Chesapeake Energy Corp. say a buyout is both unwelcome and unlikely, as reported by the Associated Press. The company will continue to pursue partnerships with other corporations on specific projects. Chesapeake has been hammered by low natural gas prices and the historic overall decline in equity markets. Its stock is trading at less than a third of its 52-week high. A buyout would damage the state''s economy, which has lost many of its largest oil companies to Houston in recent years. Takeovers often involve major changes in headquarters operations, including layoffs and other disruptions. Chesapeake''s campus dominates some of the highest priced real estate in the city. The success of Oklahoma''s oil and gas industry has allowed the state to largely avoid the economic downturn affecting much of the rest of the nation. Chesapeake co-founder and Chief Executive Officer Aubrey McClendon was forced to sell 31.5 million shares of Chesapeake stock, nearly all of his shares, last week to meet margin loan calls. McClendon, who owns a share of the Oklahoma City''s new NBA team, the Thunder, has vowed to rebuild his stake in the company. The company has announced it will reduce drilling activities to trim expenditures in the face of decreasing natural gas prices.