Cobalt Falls After Backers Sell Stakes at Discount

Cobalt International Energy Inc. (CIE), the explorer seeking oil in the U.S. Gulf of Mexico and West Africa, fell the most in more than four months after Goldman Sachs Group Inc. and other backers sold 50 million shares at a discount to yesterday’s closing price.

Cobalt, based in Houston, fell 6.8 percent to $26.83 at 10:54 a.m. in New York. The shares earlier dropped 7.6 percent, the biggest intraday decline since Dec. 12.

Affiliates of Goldman, First Reserve Corp., Riverstone Holdings LLC, Carlyle Group LP (CG) and KERN Partners Ltd. sold 50 million shares at $26.80, Cobalt said today in a statement today, a 6.9 percent discount from yesterday’s closing price. The offering dropped their combined stakes to 30.5 percent from 43 percent, according to a filing.

Carlyle, Goldman and other backers first sold shares of Cobalt to the public in December 2009 for $13.50, below their expectations of $15 to $17. Combined stakes by the backers dropped below 50 percent after they sold 40 million shares in January.

Citigroup Inc. handled the sale and has the option to buy 7.5 million shares from the selling stockholders at the offer price.

To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net

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