Samson bought by KKR for $7.5 Billion

[swake]

Company to stay in Tulsa with the current COO promoted to CEO.

What does the Schusterman family do with the $7.5 billion?

And the head of KKR, Henry Kravis is from Tulsa?

http://www.tulsaworld.com/business/article.aspx?subjectid=49&articleid=20111123_49_0_Samson67411

[cannon_fodder]

This company buys assets, builds value, and sells.  Employees are apperently safe for now, but what about after the next transaction?  Not long term good news for tulsa imho.

[heironymouspasparagus]

Another one of those companies where the next generation just wants to cash out, regardless of impact to the people who made the company what it is - the employees.  (See previous posts about tax breaks to "inheritors" of companies.)

[Patrick]

KKR will be able to provide support to Samson to take the company to the next level.  Specifically, financial support to further develop Samson's excellent oil & gas properties.  While KKR's exit could be facilitated by a buyout of a large E&P / energy megacorp, I firmly believe the plan is to take the company public.  I suspect the time frame is five to seven years.  I'd bet on Samson remaining a Tulsa company.

I don't work for Samson, but am in the industry.  M&A is my business.

[Teatownclown]

Most ownership was moved into their Foundation prior to sale....very good for Tulsa!

[SXSW]

Expect some major donations to OU from the Schustermans.

[heironymouspasparagus]

I suspect the time frame is five to seven years.  I'd bet on Samson remaining a Tulsa company.

I'll predict that in less than five years it is gutted and dispersed.

[Red Arrow]

I'll predict that in less than five years it is gutted and dispersed.

Forever the optimist. 

[heironymouspasparagus]

Forever the optimist. 

Actually, yes.  It could happen much sooner - I hope not.

[jacobi]

Yeah, I'm pretty nervous about this.  It sounds like Kravis was brough in to make people less nervous.

[Conan71]

The company represents a strong value without parting it out.  Energy is going to be an ever growing segment of our economy even when other sectors slow down.  I don't see them parceling it out, and if they do, chances are they are parcels that companies like Williams, Chesapeake, or Devon might be interested in.  Granted, CHK or Devon might move jobs to OKC rather than Tulsa, but there are many field jobs which aren't affected one way or the other by where the HQ is they report to.

[godboko71]

I hate to be an optimist but like Conan said it would never really make much sense to parcel out the company. As a owe it might be a way to help shore up long term gains and have capital to broker future buys. I see them holding long term or selling as a whole, and then I see most of the jobs staying here unless something huge changes in the next 5-10 years.

[cannon_fodder]

Parting out an oil company is among the most easy companies to break up.  A company like Samson is worth nothing more than the sum of its parts:  wells, gathering, storage, transport,  marketing and distribution.  Their acquisition was heavy on domestic wells, some gathering and transport came along with it.

I'm sorry, but there is no reason those wells can't be sold off in geographical groups.  Who owns the wells has nothing to do with Tulsa.  No reason the accounting and transactional work cant be done in OKC, Houston, Denver, or Albuquerque.  And the field jobs provide no jobs to speak of in Tulsa (but for support - payroll etc., which isn't tied to Tulsa).  Just as easy as Sinclair, Skelly, Citgo... no reason Samson can't be chunked out or just moved.

I hope I'm wrong, but KKR has a track record of bulking up companies and selling them off one way or another within 7 years.  I see no reason the same can't hold true.

[heironymouspasparagus]

Parting out an oil company is among the most easy companies to break up.  A company like Samson is worth nothing more than the sum of its parts:  wells, gathering, storage, transport,  marketing and distribution.  Their acquisition was heavy on domestic wells, some gathering and transport came along with it.

I'm sorry, but there is no reason those wells can't be sold off in geographical groups.  Who owns the wells has nothing to do with Tulsa.  No reason the accounting and transactional work cant be done in OKC, Houston, Denver, or Albuquerque.  And the field jobs provide no jobs to speak of in Tulsa (but for support - payroll etc., which isn't tied to Tulsa).  Just as easy as Sinclair, Skelly, Citgo... no reason Samson can't be chunked out or just moved.

I hope I'm wrong, but KKR has a track record of bulking up companies and selling them off one way or another within 7 years.  I see no reason the same can't hold true.

It can - easily - and probably will be.