After the close on June 19, SandRidge Energy Inc. (NYSE:SD) announced the departure of Chairman and CEO Tom Ward. Following a review by an independent investigation at the request of the Audit Committee. CFO James Bennett was named CEO and President, while Jeffrey Serota will serve as interim non-executive Chairman.

Sandridge Energy Inc

The Audit Committee also reported that the independent investigation regarding allegations of related-party transactions by Mr. Ward concluded that there was no indication of actions that would result in termination for cause. As such, per Mr. Ward’s employment agreement he receives $53.5 million in cash (3x average prior three annual bonuses), vesting of 6.3 million shares of restricted stock, and payment of $4.6 million over three years (annual salary for 36 months). As of his last filing, Mr. Ward owns 17 million shares of SD or 3.4% of the company.

“Two separate Board investigations have now confirmed that Tom Ward’s actions were proper. No one has worked harder for or been more loyal to SandRidge Energy than Mr. Ward,” said Steven M. Bauer, a lawyer representing Mr. Ward.

New SandRidge Energy Inc. (NYSE:SD) CEO

Given the previously-announced investigation and Board restructuring, many do not view Mr. Ward’s departure as a surprise. The appointment of Mr. Bennett as CEO suggests comfort by the Board in having a leader with less operational experience and more financial experience (Mr. Bennett’s background is in investment banking and private equity before becoming CFO of SD in 2011). This could suggest its interest in asset or corporate restructuring.

Indeed, Dow Jones is reporting that the company could be up for sale, potentially offsetting concerns on whether the changes are big enough and making an external search unnecessary. Mr. Bennett was SandRidge Energy Inc. (NYSE:SD)’s CFO and does bring some continuity to operations and internal retention.

SandRidge two steps: Brian Singer, CFA, Equity Research at Goldman Sachs Opines

We believe the two key areas needed for SD to become more attractive to equity and/or corporate investors are: (1) showing improved Mississippi Lime asset quality with more consistent well performance to such an extent that it outweighs a substantial reduction in the company’s acreage position; and (2) reducing what appears to be a substantial ongoing funding gap. We view valuation as unattractive at 7.5x 2014 EV/EBITDA vs. gas-to-liquids transitional peers of 5.1x. We rate SD Sell relative to an Attractive coverage view. Our estimates and target price are unchanged.

Shares of SandRidge are up 4.33% in after hours trading to $5.32 a share.