By Jeff Raymond, Oklahoma Impact Team
OKLAHOMA CITY -- The former chief executive of ConocoPhillips will be the new chairman of the board of Chesapeake Energy, the company announced Thursday.
Archie W. Dunham will replace Aubrey McClendon as chairman, although McClendon will remain on the board and will continue to serve as Chesapeake CEO and president. Dunham, 73, who spent more than three decades at Conoco until his 2004 retirement, has no previous experience with Chesapeake, according to a company news release. Appointment of an independent, non-executive chairman was one of the key demands of the company's largest shareholders.
The company also named four independent directors to the reconstituted nine-member board. Bob G. Alexander, R. Brad Martin, Frederic M. Poses and Vincent J. Intrieri also will join the board.
Southeastern Asset Management, which owns 13.9 percent of Chesapeake and is the company's largest shareholder, proposed Alexander, Martin and Poses.
Alexander, 78, is the founder of Alexander Energy Corp. and served as its chairman and CEO from 1980 to 1996. Martin, 60, was chairman and CEO of retailer Saks Inc. from 1989 to 2007, and serves on the boards of FedEx Corp. and Dillard's Inc. Poses, 69, is CEO of Ascend Performance Materials and was chairman and CEO of Trane Inc. from 1999 to 2008.
Carl C. Icahn, who owns 7.6 percent of Chesapeake and is the company's second largest shareholder, proposed Intrieri. Intrieri, 55, is senior managing director of Icahn Capital LP, the entity through which Icahn manages investment funds.
The new directors will replace Richard K. Davidson, Kathleen M. Eisenbrenner, Frank Keating and Don Nickles, all of whom have resigned, and Charles T. Maxwell, who retired at the June 8 shareholder meeting.
Shareholders rejected the re-election of Davidson and director Burns Hargis, but the board did not have to heed the vote. Because Hargis serves on the board's audit committee, which is looking into McClendon's financial transactions, he will continue to serve as a director, according to the news release. The board will consider his resignation when the review is complete.
Directors Lou Simpson and Pete Miller will remain on the board.
In the release, Miller cited Dunham's experience in the energy industry and independence as reasons for his selection.
"We look forward to working with Archie and our four other new board members, all of whom have the right blend of broad experience and sound judgment to guide Chesapeake and provide strong accountability going forward," Miller said in the release.
In the release, Icahn praised the proposed changes. "We believe Chesapeake is now heading in the right direction. With the board providing strong oversight, the management team will be sharply focused on realizing the value of its assets and the company will be well positioned to create substantial value for shareholders going forward," the billionaire investor said.