Catching Up -- Part III -- March 9, 2015; Whiting Sale -- Zeits -- Seeking Alpha

Over at Seeking Alpha, Richard Zeits on Whiting's announcement it is up for sale.

Summary:

• The report in the Wall Street Journal of a strategic sale process at Whiting comes as a surprise.
• Despite the elevated debt level, the company appears to be solidly positioned strategically, with an extensive and economically competitive asset base.
• Waiting out for a cyclical recovery would appear to make more strategic sense. 

Zeits concludes: several thoughts come to mind in this regard:

• Could the process be undertaken in response to an unsolicited offer? A bid at a significant premium, particularly an all-cash bid, can trigger a review of strategic alternatives, or even put the company "in play." I should also note that given the depressed commodity price environment, the Board would likely have a very defensible "just say no" option.
• Is the threshold for the acquisition premium set at a very high level? If indeed the case, the initiative could provide support for the stock price, but would hardly be a responsible course of action.
• Could Wall Street Journal exaggerate the significance of what the publication referred to as an auction process? Nothing can be ruled out.