Phillips 66 has filed a definitive proxy assertion and fielded its personal set of board director nominees for election, gearing up for a proxy combat in opposition to activist stakeholder Elliott Funding Administration LP.
In a letter to shareholders, the corporate stated that Elliott was an “activist hedge fund pushing an aggressive short-term agenda,” that included “a rushed breakup of our firm primarily based on flawed evaluation”.
“Elliott seeks speedy, irreversible change in pursuit of an unrealistic thesis – and dangers halting the momentum on our long-term value-creating strategic plan,” Phillips 66 stated within the letter.
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Phillips 66 is nominating 4 director candidates, together with two new nominees: John Lowe, a frontrunner with greater than 40 years of management in midstream, refining and chemical compounds companies; Robert Pease, a director recognized in partnership with Elliott; A. Nigel Hearne, a 35-year veteran of the power trade with direct refining operations management; and Howard Ungerleider, a former President and CFO with intensive chemical compounds expertise. The corporate’s annual shareholders assembly is scheduled for Might 21.
In a March assertion, the corporate’s lead impartial director Glenn Tilton stated, “After cautious consideration of Elliott’s nominees and several other conversations with Elliott’s representatives over a number of years, we have now decided that the dissident nominees don’t possess expertise or experiences not represented on the board already or that will immediately drive additional shareholder worth creation. Additional, Elliott’s inconsistent strategy and evolving calls for would introduce undue threat by prioritizing unsure short-term good points over a disciplined, long-term technique. The board reiterates its dedication to scrupulously evaluating the portfolio and strategic alternate options to maximise long-term shareholder worth whereas avoiding choices pushed by short-term market fluctuations and speculative valuations.”
Goff Letter to Shareholders
In a current public letter, power trade veteran Gregory Goff, who stated he had a $10 million funding within the firm, stated that he supported the slate of administrators nominated by Elliott.
“I’ve been disenchanted by what I see as a breakdown in efficient company governance at Phillips 66. I do know from expertise how essential it’s for an organization to have a robust board — possessing each the independence and the experience to query administration’s assumptions concerning the enterprise and contemplate the long-term implications of each resolution. I don’t see proof of that form of tradition at this time on the Phillips 66 board,” Goff stated within the letter.
Phillips responded with an announcement saying that Goff was “clearly affiliated” with Elliott.
“As of this morning, he stays featured as CEO of Amber Power, an entity that Elliott has backed in its bid for Citgo, a Phillips 66 competitor. This essential and apparent reality a couple of clear battle of curiosity was by no means talked about in Mr. Goff’s communication and is plainly deceptive to shareholders. The notion he’s an investor impartial of Elliott is clearly false,” the corporate stated.
“This stunt displays Elliott’s rising desperation to persuade actual buyers to help its shortsighted, rushed breakup of Phillips 66. We’ll proceed to have interaction with all buyers on the info and stay assured that these buyers worth the dependable $43 billion {dollars} of worth we have now returned by way of risky market cycles,” Phillips 66 stated.
Earlier in March, Elliott nominated seven candidates for election to Phillips 66’s board. The agency, which has a declared funding of over $2.5 billion in Phillips 66, stated it’s pushing for portfolio simplification, an operational evaluate, and stronger oversight.
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