Largest Shareholder Urges Chesapeake To Consider Possible Buyout Offers

Chesapeake's largest shareholder is urging company management to put Chesapeake up for sale. There's no indication that will actually happen, but it's the latest in a series of hits Chesapeake has taken.

5/3/2012 Related Story: Chesapeake Energy Confirms SEC Probe

It's been one thing after another for Chesapeake and CEO Aubrey McClendon the last few weeks. From investigations into possible improper financing arrangements, to a hedge fund McClendon helped run on the side, to poor first quarter's earnings and the stock continuing to drop, now this, a letter filed with federal regulators on Monday from Southeastern Asset Management.

Southeastern is Chesapeake's largest shareholder, with 13.6 percent company ownership. In a filing last week, Southeastern indicated it would become more active in Chesapeake management. Monday's letter affirmed that Southeastern CEO Mason Hawkins leveling criticism at the company's current strategy and its communications with shareholders.

"The last point may be taken out of context, but is important: we urge the board to be open to any offers to acquire the whole company," Hawkins stated in the letter.

The letter goes on to say they recognize Chesapeake is undervalued right now and they don't want to encourage any lowball bids, but think any bid that recognizes the long-term value of the company should be given consideration.

There's no public evidence any bidders are out there right now, and no evidence current Chesapeake management would be willing to sell.

Chesapeake stock has fallen almost 45 percent in the past year. It was down only slightly after Monday's news.