Analysts: Hamm’s Offer to Continental Points to Industrywide Undervaluing of E&Ps

Continental Resources’ founding family said it’s prepared to leave the public market to pursue a more flexible and nimbler path as a private operator.

Analysts: Hamm’s Offer to Continental Points to Industrywide Undervaluing of E&Ps

Harold Hamm’s rationale for the move is that the market is now more of a hindrance than a help to his company and its ambitions to continue to explore, according to an email he sent Continental Resources employees. (Source: Hart Energy, Continental Resources Inc.)

The prevailing reaction to Harold Hamm’s $4.4 billion offer to take Continental Resources Inc. private due to a lack of love by the market was, in essence, “he has a point.”

On June 14, the Oklahoma billionaire and his family presented its offer to the company’s board, partly out of frustration that they (and other independent E&Ps) remain far undervalued by the market in light of high commodity prices and financial strength.

Beyond that consensus, analysts raised multiple scenarios over what’s likely to happen next.

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Darren Barbee

Darren Barbee is senior editor for Oil and Gas Investor magazine.