A $79 million merger that would have taken Santa Maria Energy public has been called off after its financiers couldn’t gather the votes to pass it.

Santa Maria Energy won approval last year to drill 136 new oil wells near Orcutt. The company plans to spend $120.7 million drilling those wells this year. Santa Maria Energy said from outset of its going-public deal that it would have also needed to tap private equity to meet its capital budget, and the company will now turn to those investors.

“We knew that this was a possibility,” said Beth Marino, vice president of legal and corporate affairs for the firm. “We planned accordingly and have made plans to secure alternate financing. We’re kicking that off immediately and don’t anticipate this will cause a significant delay in our plans.”

Santa Maria Energy announced plans in December to merge with Hyde Park Acquisition Corp. II, a so-called blank check firm whose function is to place its investors’ cash into an operating company.
The deal would have put Santa Maria Energy on the Nasdaq and pumped up to $79 million in fresh capital into the oil firm, which has already secured $50 million in private equity funds from energy-focused Kayne Anderson Capital Advisors.

Under the deal, Hyde Park shareholders could vote to approve the transaction or ask for their money back. The deal required approval from shareholders representing $40 million of Hyde Park’s fund. Though the vote totals have not been released, Santa Maria Energy’s Marino said the $40 million threshold wasn’t met. Hyde Park officials did not return an immediate request for comment.

As reported earlier in the Business Times, Hyde Park had told its investors that it wouldn’t buy into a company unless it could obtain a controlling stake. That would not have been the case with Santa Maria Energy. Even if Hyde Park had transferred its full $79 million to Santa Maria Energy, it would have owned only 38.8 percent of the resulting company, with Santa Maria Energy’s current stockholders owning 61.2 percent.

From the outset of the merger, Santa Maria Energy said it would have needed to raise additional capital from private equity and debt sources to fund its 2014 capital budget. Marino said Santa Maria Energy has started those talks and that changing tracks is expected to cause “some delay, but it won’t be significant.”