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Vista Projects
Copper Tip Energy
Vista Projects

Midstates Petroleum Proposes Combination with SandRidge Energy in All-Stock Transaction

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TULSA, Okla.–(BUSINESS WIRE)– Midstates Petroleum Company, Inc. (NYSE: MPO) (“Midstates” or the “Company”) today announced that it has proposed to combine with SandRidge Energy, Inc. (NYSE: SD) (“SandRidge”) in an all-stock merger that would create the leading exploration and production company in the Mississippian Lime play. Earlier today, Midstates sent a letter to the Board of Directors of SandRidge detailing the merger proposal and its strong desire to negotiate a friendly transaction. A copy of the letter is included below.

This press release features multimedia. View the full release here:

Given the highly complementary nature of the businesses, significant shareholder overlap, and the substantial operational synergies, Midstates believes that the proposed combination is attractive strategically and financially for the shareholders of both companies. Under the terms of the proposal, SandRidge shareholders would own approximately 60% of the combined company and Midstates shareholders would own 40%.

David J. Sambrooks, Midstates President and Chief Executive Officer, stated, “We are ready to move forward immediately to negotiate a merger agreement to form a stronger, more formidable company. The combined company will have zero net debt, strong liquidity, and forecasted free cash flow generation of up to $480 million over the next five years.”

Mr. Sambrooks continued, “Combining these two businesses in an at-market merger would bring undeniable benefits to shareholders of both companies. The strategic fit and geographic overlap of both companies’ assets in the Miss Lime and NW STACK builds critical mass, creates significant synergies, and generates superior, risk-adjusted returns.”

Midstates is making this proposal public to inform both Midstates and SandRidge shareholders of the compelling value creation potential of the combination and to encourage SandRidge’s board to move towards a negotiated transaction.

Strategic & Financial Rationale

Midstates believes that as one company, shareholders of Midstates and SandRidge would share in the substantial upside, and the merger would provide significant benefits to both sets of shareholders that would not be available to either company on a standalone basis.

The combined company would:

  • Achieve greater than $70 million in annual synergies, resulting in significant value creation, projected annual free cash flow of over $100 million and accretion to both sets of shareholders;
  • Have increased scale, liquidity, access to capital markets and interest from a broader investor base, driving potential multiple expansion;
  • Join highly complementary assets in the Mississippian Lime and NW STACK;
    • Control over 450,000 net acres in the core of the Mississippian Lime play and produce over 53,000 barrels of oil equivalent per day;
    • Own 75,000 net acres in the emerging NW STACK play currently being delineated through an attractive DrillCo and other operators that holds significant upside potential;
  • Be led by David J. Sambrooks, Midstates’ President and Chief Executive Officer; respective shareholders to provide input on the Board of Directors;
  • Implement a strategy focused on proven assets in the Mississippian Lime that optimizes the drilling program, high-grades the combined inventory and utilizes the latest in new generation completion technology; and
  • Drive shareholder value and enhanced cash flow with prudent investment, non-core asset divestitures and a clean balance sheet.

Under the terms of the proposal, SandRidge shareholders would receive 1.068 shares of Midstates for each existing SandRidge share. Midstates is prepared to work expeditiously to close the transaction as soon as the second quarter of 2018. Any transaction would be subject to regulatory and shareholder approvals and other customary closing conditions.

Shareholder Support

The transaction has the support of Fir Tree Partners and Avenue Capital Group, Midstates’ largest shareholders, holding a combined 40% of the equity. Additionally, there is significant shareholder overlap between the two companies of approximately 40%.


Moelis & Company LLC is acting as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal counsel to Midstates.

Investor Presentation and Call

In conjunction with this release, Midstates has posted an investor presentation on the Company’s website, providing additional details on the substantial benefits related to the combination of Midstates and SandRidge discussed above.

The Company will host a conference call to discuss the proposed transaction on Tuesday, February 6, at 8:30 a.m. Eastern time (7:30 a.m. Central time). Participants may join the conference call by dialing (833) 851-6150 (for U.S. and Canada) or (478) 219-0257 (International). The conference ID is 6694657. To listen via live webcast, please visit the Investor Relations section of the Company’s website,

An audio replay of the conference call will be available approximately two hours after the conclusion of the call. The audio replay will remain available until midnight on February 20, 2018 and can be accessed by dialing (855) 859-2056 (for U.S. and Canada) or (404) 537-3406 (International).

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements that are not statements of historical fact, including statements regarding the Company’s strategy, future operations, financial position, estimated revenues and losses, projected costs, resource potential, drilling locations, prospects and plans and objectives of management, are considered forward-looking statements. These forward-looking statements include statements of anticipated changes in the business environment in which the Company operates and in the Company’s future operating results relating to the Company’s offer and the potential benefits of a transaction with SandRidge. There is no assurance that the potential transaction will be consummated, and it is important to note that actual results could differ materially from those projected in such forward-looking statements. Without limiting the generality of the foregoing, these statements are based on certain assumptions made by the Company based on management’s experience, expectations and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Although the Company believes that its plans, intentions and expectations reflected in or suggested by the forward-looking statements made in this press release are reasonable, the Company gives no assurance that these plans, intentions or expectations will be achieved when anticipated or at all. Moreover, such statements are subject to a number of factors, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These factors include, but are not limited to variations in the market demand for, and prices of, oil and natural gas; uncertainties about the Company’s estimated quantities of oil and natural gas reserves, resource potential and drilling locations; the adequacy of the Company’s capital resources and liquidity; general economic and business conditions; weather-related downtime; failure to realize expected value creation from property acquisitions; uncertainties about the Company’s ability to replace reserves and economically develop its current reserves; risks related to the concentration of the Company’s operations; drilling results; and potential financial losses or earnings reductions from the Company’s commodity derivative positions.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About Midstates Petroleum Company, Inc.

Midstates Petroleum Company, Inc. is an independent exploration and production company focused on the application of modern drilling and completion techniques in oil and liquids-rich basins in the onshore U.S. The Company’s operations are currently focused on oilfields in the Mississippian Lime play in Oklahoma and the Anadarko Basin in Texas and Oklahoma.

Midstates Petroleum Company, Inc.
Jason McGlynn, 918-947-4614
Investor Relations
[email protected]

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