The company plans to sell its midstream assets in three separate transactions for expected cash proceeds of $4 billion. The divestitures will allow the company to reduce previously budgeted capital expenditures by about $3 billion over the next three years.

Limited partner and general partner interests in Chesapeake Midstream Partners LP will be sold to Global Infrastructure Partners for $2 billion, with the transaction completed by the end of the month. The net book value of the assets as of March 31 was about $1 billion. It anticipates reporting the pretax gain on the sale of about $1 billion.

In a U.S. Securities and Exchange filing, Southeastern Asset Management Inc. – the company’s largest shareholder – said it was a move in the right direction.

“We applaud this morning's announced sale of the midstream assets,” Southeastern wrote in the filing. “As laid out in our Schedule 13D dated May 7, 2012, we urged the move not just to strengthen the balance sheet, but also to reduce future capital spending. We are pleased that the company has moved so quickly to increase its financial flexibility, and support management's intentions to monetize other meaningful non-core assets not recognized in today's share price. We believe that management and the soon-to-be reconstituted board will vigilantly prioritize and pursue these and other value-creating opportunities.”

J. Mike Stice, CEO of Chesapeake Midstream Partners, said it is a good move for both companies.

“I’m excited that GIP has made this commitment to acquire a larger ownership stake in CHKM,” he said. “GIP has been an outstanding sponsor and partner for CHKM over the past three years, and I look forward to the opportunity to continue that relationship. This new ownership structure creates an independent MLP, and enhances CHKM’s ability to execute on its low-risk business model and industry leading growth opportunities.”

As to the board members, Southeastern and the company’s second largest shareholder, Carl Icahn, plan to reconstitute the board. Southeastern owns 13.6 percent of the company’s common stock, and Icahn owns 7.6 percent. In response to both, Chesapeake announced June 4 it will add four new independent directors to replace four who will resign, a fifth who plans to retire, and a new independent non-executive chairman who will be selected soon. 

CEO Aubrey McClendon will remain in his post, but as previously decided in May, will not serve as chairman of the board, although he will remain a director.

Preliminary voting results from the shareholder meeting show two directors up for reelection, V. Burns Hargis and Richard K. Davidson, were reelected to the board, but since they received 26 percent and 27 percent respectively of votes cast, both tendered their resignations as required by the company’s new majority voting bylaw.

In the SEC filing, Southeastern stated it voted against both men for reelection, but with a caveat.

“However, we would be supportive of Mr. Hargis' resignation not being accepted by the board until the Audit Committee, which he chairs, completes the board review currently underway,” Southeastern wrote. “We would anticipate this review being completed as quickly as possible, although it needs to be handled appropriately. We are hopeful that this review can be completed in a matter of weeks not months. This timing change would not impact the election of the three directors we will be recommending as laid out in the company press release this past Monday.”