SandRidge Energy announced on Wednesday that it had settled with a hedge fund that had been calling for the removal of the oil driller’s chairman and chief executive, Tom Ward.
SandRidge said that it would expand its board by four seats, giving the new positions to the activist investor, TPG-Axon Capital. The company also said that it also would decide by June 30 whether to remove Mr. Ward from his position.
If SandRidge doesn’t fire Mr. Ward, three of its existing directors will step down, and TPG-Axon will name an additional board member. That would give the hedge fund majority representation on the company’s board.
The oil driller also agreed to review its strategic plans, and said that it would reduce its directors’ pay to $250,000 a year, from $375,000.
Wednesday’s announcements represent a striking victory for TP-Axon, which had questioned a series of land deals that SandRidge had struck with Mr. Ward and his family. The hedge fund had also criticized SandRidge for a series of strategic mistakes, leading to a nearly 29 percent decline in the company’s stock price over the last 12 months.
A vote on TPG-Axon’s effort to win board seats had been scheduled for Friday.
“We believe the actions taken by the board address our concerns, and are a promising start to a bright future for SandRidge,†Dinakar Singh, TPG-Axon’s founder, said in a statement. “We all believe that SandRidge has tremendous asset value, and we expect that the company will relentlessly focus on growing and realizing that value through a particular focus on execution and efficiency.â€
Separately, SandRidge said that its chief operating officer, Matthew K. Grubb, would resign.
