US independent SandRidge Energy is prepared to evaluate offers for some of its assets after this week rejecting an all-stock merger proposal from rival Midstates Energy, writes Caroline Evans.

SandRidge said it had started reviewing strategic alternatives, including divestitures, after other companies expressed interest in its acreage following Midstates' proposal in February.

The company said it would explore a divestment of or joint venture for its North Park basin assets in Colorado. It also said it would evaluate "potential corporate and asset combination options with other Midcontinent operators, including Midstates, should it elect to participate in this competitive process", according to a statement.

The company said it would not provide a timetable for the evaluation process.

Regarding Midstates' offer, SandRidge said it had concluded following a detailed review that the deal would dilute the company's shares and would not benefit long-term shareholders.

"After extensive analysis, SandRidge has concluded that the relative asset values of the two companies do not support a combination effected at current stock prices," SandRidge said.

"The decision was primarily based on significantly differing opinions of Midstates’ proven oil and gas reserves, largely related to the assessment of the number of economically viable drilling locations at current oil and gas prices.

"SandRidge recognises the combination would likely result in meaningful synergies given the expectation that SandRidge could efficiently absorb Midstates’ assets and operations with limited incremental expense."

However, SandRidge said it did not agree with Midstates' estimate that the combination would result in generally flat production and free cash flow of $320 million to $400 million from 2019 to 2022.

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SandRidge to review strategy after snub