Elliott twists Phillips 66’s arm even more as it builds $2.5 billion stake
The activist investor and oil refiner struck a deal a year ago. Apparently it wasn’t enough.
Phillips 66 might have thought it was out of the woods with Elliott Investment Management a year ago, when it bowed to pressure from the activist investor by agreeing to name one Elliott-approved director to its board and give Elliott input on naming a second.
But the second director never got named, and Elliott reportedly isn’t happy about it. Combine that with the fact that Phillips 66’s stock has fallen more than 25% from its April 2024 peak, and you wind up with today’s news: Elliott is ramping up the pressure again.
The Wall Street Journal reports that Elliott has boosted its stake in the company to a whopping $2.5 billion and plans to push the oil refiner to shuffle its operations to boost its stock price.
Shares of Phillips 66 rose 4.2% in recent trading.
In a press release this morning, Elliott said, “It has become evident that urgent changes are needed” at the company, including selling or spinning off the company’s midstream business, as well as selling interests in a firm called CPChem and some operations in Germany and Austria.
It also said the company needs to review its operations and add independent directors who can “oversee a comprehensive review of the executive leadership team.”
For its part, Elliott has had a decent run of successfully influencing changes at companies it targets, including Starbucks, Southwest Airlines, and Honeywell.
