Pogo Producing Co., Houston, (NYSE: PPP) has retained Goldman, Sachs & Co. and TD Securities Inc. to seek strategic alternatives for the company, including a possible sale of some or all of its assets.
Pogo's portfolio involves 12.6 million acres in the U.S. (primarily the Gulf of Mexico and Gulf Coast), Canada, New Zealand and Vietnam. Production is 292.3 million cu. ft. of gas and 29,943 bbl. of oil and condensate per day. Proved reserves are 2.2 trillion cu. ft. equivalent.
Daniel S. Loeb and Bradley L. Radoff of Third Point LLC will join the Pogo board. Third Point requested six members on the board, which is being expanded from eight to 10 members. Entities advised by Third Point own 7.9% of Pogo shares. Loeb is managing member of Third Point. Radoff is a partner.
Pogo also may name Robert B. Rowling to the board. He is chairman of TRT Holdings Inc.
Pogo chairman and chief executive Paul Wagenen says, "Through this agreement, we will avoid a potentially costly and disruptive proxy contest at a time when Pogo is exploring a range of strategic alternatives to enhance shareholder value."
Loeb has criticized Pogo for its shareholder returns. "While we are disappointed in the results achieved under your leadership, we continue to believe the company's assets are valuable and under-utilized," he wrote to Pogo management.
"Hiring Goldman, Sachs & Co. and TD Securities Inc. is a positive step, but we have no faith in the current board's ability to oversee such a process."
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