US shale player QEP Resources has entered into a cooperation agreement with US hedge fund Elliott Management, following a previous takeover offer.

Elliott owns around 4.9% of QEP’s common stock.

The duo will work together to identify board nominees and to agree upon two new independent directors to be appointed to QEP's board. The two new directors are expected to be seated no later than October of this year, QEP said.

In addition, QEP said it will create a new five-person operations committee which will be chaired by its chief executive, Tim Cutt, and will include two of the current independent directors and, the two new independent directors.

The committee will work to identify best practices in the areas of the company’s operations and focus on continuous operational improvement.

The cooperation agreement comes after a $2 billion takeover attempt by Elliot in January. QEP said at the time it would review the proposal.

The deal would have transitioned QEP from a publicly held entity to a privately owned one.

In February, QEP cancelled a $1.65 billion cash-and-stock deal to sell its assets in the Williston basin of North Dakota to Vantage Energy Acquisition Corporation, after deciding the transaction was unlikely to meet closing conditions due to low commodity prices.

QEP added that its search for alternatives would include considering Elliott’s bid.

Meanwhile, QEP returned to profit in the second quarter of the year, after selling off non-core assets.

The company reported net income of $48.8 million for the second quarter, compared with a net loss of $336 million for the second quarter of last year.

The return to profit was supported by a 13% increase in production in the Permian. Oil and condensate production in the Permian basin was 3.3 million barrels in the quarter, an increase of 2% compared with the second quarter of 2018.

Online

QEP inks Elliott pact