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In its March 6 article, The Wall Street Journal reported that Whiting Petroleum (WLL) "is in midst of auction process," referencing "people familiar with the matter" ("Whiting Petroleum Seeks Buyer Amid Plunge in Crude Prices"). I should note that the article also states that "it is unclear who may be interested in buying the company and there is no guarantee it will be sold."
Given The Wall Street Journal's credibility, the odds are high that Whiting may indeed be seeking an acquirer (and may in fact have little concern over the "leak"). The format is most likely what investment bankers call a "controlled auction" (when financial advisors privately approach a select number of the most probable potentially interested parties). Given that Whiting had already tested the market three years ago and Kodiak, which recently merged with Whiting, also engaged in a number of strategic discussions, according to industry reports, some potential acquirers may have already done significant work on the combined companies' assets.
It is no secret that many E&P companies routinely engage in M&A conversations with peers. Countless investment bankers spend an inordinate amount of time pitching every imaginable "strategic" idea to clients on all fronts. And while companies in their investor presentations often highlight significant unrealized values that their assets offer, some of those same companies would be glad to forfeit a portion of the potential upside and settle for a "right price" in the event an offer materialized.
The Whiting news is significant. With its large positions in two proven prolific oil resource plays, Whiting is an intriguing
