You are here
NEW YORK -– Despite 17 years of underperformance compared to the Standard & Poor’s 500 Index, Hess Corp. continues to avoid accountability, Elliott Management Corp. told Hess shareholders during today’s "Reassess Hess Town Hall Meeting."
The activist investor group hosted the meeting at New York City’s Le Parker Meridien hotel in an effort to encourage Hess shareholders to vote for its five proposed board of director nominees at the oil company’s annual meeting on May 16.
Elliot Management owns 4.52 percent of Hess, valued at more than $1 billion. It has repeatedly stated Hess’ stock price is considerably undervalued.
Conversely, Hess did announce a restructuring last month. It is becoming a pure-play exploration and production company, in part by selling its 1,361 convenience stores and gas stations.
"Whether Hess owns retail gas stations or not does not solve its problems," said Elliott Management associate Quentin Koffey, who delivered prepared remarks at the beginning of the event. "Will the perpetual restructuring ever stop? This is the seventh time they’ve announced such a restructuring."
Introduced at today’s town hall meeting were Elliott Management’s proposed new Hess board members: Rodney Chase, Harvey Golub, Karl Kurz, David McManus and Marshall Smith. All but Smith were present at the meeting. According to the investor group, its slate of nominees boasts considerable industry experience at companies such as BP plc, Royal Dutch Shell plc and Anadarko Petroleum Corp.
All of the nominees in attendance agreed that they were excited to be dissident members of Hess’ 14-member board of directors and said a turnaround of the company is definitely achievable.
"The problems can be rectified by improving the culture in the boardroom," noted Chase, a 38-year industry veteran.
Since coming under attack by Elliot Management, Hess has consistently reiterated that Wall Street analysts applaud its restructuring plan. The company recently proposed its own six board of director nominees. As CSNews Online reported, Hess also has sent four letters to shareholders encouraging them to reject Elliott Management’s proposals and slate of nominees.
Hess Corp. CEO John Hess has run the company for the past 15 years. When asked during the town hall meeting’s question-and-answer session whether he liked the chief executive’s job performance, Chase acknowledged that running a company for 15 years is an impressive feat. However, he pointed out that it’s difficult for even the most successful CEO to run a company for much longer.
"I don’t know what’s talked about in the boardroom, but I would be surprised if the board has not discussed the succession issue," Chase concluded. "That is definitely something the board must address in the coming months."