Chesapeake Directors Voted Out

Two directors offer to resign after shareholders reject their re-election.

Chesapeake Energy Corp. shareholders rejected two directors involved in a probe of Chief Executive Officer Aubrey McClendon’s personal finances after slumping energy prices and overspending wiped out $2.6 billion in market value this year.

V. Burns Hargis and Richard K. Davidson, members of the company’s audit committee, offered to resign after receiving support of 26 percent and 27 percent of votes cast, respectively, at the annual meeting at Chesapeake’s Oklahoma City headquarters today. The board doesn’t have to accept the resignations and will review them “in due course,” according to a statement.

Keeping Hargis

In a filing today, Southeastern said it would support Chesapeake refusing Hargis’s resignation to allow him to stay on until the review of McClendon’s finances are completed. Southeastern said it voted against both Hargis and Davidson, and said it hopes the review can be completed within “weeks, not months.”

Asset Sales

Today, the company announced plans to sell its pipeline assets for about $4 billion to Global Infrastructure Partners in three cash transactions. Chesapeake will sell its interests in Chesapeake Midstream Partners LP to Global Infrastructure for $2 billion, the company said in a statement. Chesapeake also will raise more than $2 billion by divesting its pipeline development unit and some central U.S. conduits to Chesapeake Midstream.

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