One of Henry Kravis’ big, bad energy bets is looking even worse. Suitors for bankrupt Samson Resources are seeking to pick up pieces at a steep discount to the $7. 2 billion the fracking giant fetched in a buyout led by Kravis’ KKR in 2011, The Post has learned.
Preliminary bids for all the pieces of the shale oil firm total roughly $1. 2 billion, or less than a quarter of its previous valuation, according to two sources. The $1.
2 billion figure doesn’t include the $300 million in cash Samson has on its books. Investors aiming to scoop up Samson and other energy assets at discounted prices expect natural gas prices to stay relatively low despite signs the prolonged glut is easing. “It’s not a crazy valuation,” said one buyer of distressed energy assets.
“I think there is not a high ceiling on gas. ” Natural gas prices shouldn’t go much above $3. because of the huge reserves in the Marcellus shale region that includes Ohio, Pennsylvania and West Virginia, one source said.
Samson declined to comment. The Tulsa, Okla. company’s senior lenders, including JPMorgan and Bank of America, took possession of Samson after it filed for bankruptcy last year.
The bankruptcy wiped out the $4. 1 billion in cash KKR and its partners invested in the company, which drills mostly in Texas, Oklahoma and North Dakota. The $1.
5 billion recovery, including Samson’s cash, would be more than its senior debt of $950 million, making those creditors whole. But it is far short of Samson’s $4. 9 billion in total liabilities — leaving more junior creditors in the cold.
The leveraged buyout of Samson saddled the company with about $3. 6 billion of debt. Natural gas prices tumbled shortly after the deal, leaving Samson and other oil and natural gas companies scrambling to survive.
The fate of another disastrous KKR energy bet is also playing out. NextEra Energy said Friday it agreed to buy Energy Future Holdings’s 80 percent stake in regulated utility Oncor in an $18. 4 billion deal.
KKR and led the $44 billion buyout Energy Future, formerly called TXU, in 2007. Like Samson, TXU also ended up in bankruptcy, wiping out $8. 3 billion in shareholder value.