NEW YORK (AP) — Hess Corp. says it is willing to add two of Elliot Capital Management's nominees to its board after they agreed to forgo compensation from the hedge fund. But Elliot Management says the Hess move is a stunt, and it wants shareholders to hold out for bigger changes.
Monday's back-and-forth was the latest chapter in a drawn-out proxy battle between the hedge fund and the energy company as Hess's annual shareholder meeting draws closer.
Activist shareholder Elliot Capital Management's nominees agreed earlier in the day not to accept compensation that they could have received from the hedge fund, if elected to the Hess board. The five nominees said in a regulatory filing that they have signed agreements waiving their rights to future payments from Elliott.
Hess said it will choose the nominees after the annual meeting, if all five of Hess's own nominees are elected by shareholders.
"We believe this proposed resolution will allow us to continue executing our plan and focus on the task at hand," Hess said in a statement.
Elliott fired back that the move is more of the same from the company and was done without consultation with the hedge fund. The firm continues to urge shareholders to vote in favor of all five of its nominees.
"Shareholders want real change, yet Hess is doing everything they can to avoid it," Elliot said in a statement.
Elliot has been pushing for drastic changes at the New York-based company. Hess has accused the firm of trying to disrupt progress it has already made in reshaping itself and break up the company.
Hess said it has taken steps to respond to shareholder requests, including its announcement last week that it will split the roles of chairman and CEO following the annual meeting. John Hess, son of the company founder, will keep the CEO title, and the non-executive chairmanship will go to John Krenicki, former GE vice chairman, if shareholders approve.
The company is trying to sell its retail gas stations business, along with its energy trading and marketing businesses, as it shifts its focus further toward exploration and production. The company also plans to sell U.S. oil storage terminals and will shutter a New Jersey refinery as it exits the volatile refining business.
Elliott argues that those moves fall short of the kind of change needed at the company. Its efforts got a boost last week when the influential firm Institutional Shareholder Services backed Elliott's argument and recommended that investors support Elliott's slate of nominees.
Hess says the ISS report is "a fundamentally flawed analysis" that does not address key issues.
Hess shareholders will vote on board members at Hess' annual meeting set for Thursday in Houston.
Hess shares rose 9 cents to close at $69.39.