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NEW YORK -- ConocoPhillips is "right on schedule" to complete the spinoff of its downstream division -- called Phillips 66 -- on May 1, CEO James Mulva affirmed during an investor update this afternoon. Phillips 66 will be the parent to all ConocoPhillips branded convenience stores.
Mulva's statement is significant as it marks the first time ConocoPhillips has publicly reported an exact date for the spinoff to occur. The company last said on Jan. 25 that the spinoff could take place as early as May.
Today, Mulva also released several more details about the upcoming Phillips 66 spinoff. For every two shares of ConocoPhillips owned on April 16, stockholders will receive one share of Phillips 66 on May 1, Mulva revealed.
Phillips 66 will have 10,000 branded marketing outlets under its umbrella, Mulva said during his presentation. Refining and marketing will comprise 78 percent of all of Phillips 66’s revenues.
Mulva also disclosed for the first time that Phillips 66 will pay an annual dividend of 80 cents per share, with the first dividend expected to be paid in the third quarter. Therefore, if shareholders retain both their ConocoPhillips and Phillips 66 shares post-split, they can expect at least a 15-percent combined dividend increase this year, according to the chief executive.
"It's the right plan for ConocoPhillips," Mulva said of the spinoff. "…We think this is really an efficient way to accomplish repositioning. We think this downstream company will be as good or better than any other [company]."
Once the spinoff is complete, Mulva has confirmed he will retire. Ryan Lance has already been named the future CEO of the upstream ConocoPhillips company, while Greg Garland will become CEO of the downstream Phillips 66 company.
ConocoPhillips finished 2011 with $6 billion in net cash and plans to repurchase $10 billion worth of its shares by the end of 2012, Mulva concluded.