(Reuters) -Activist Elliott Investment Management has built an over $2.5 billion stake in U.S. oil refiner Phillips 66 and plans to push for operational changes to boost its stock, a person familiar with the matter told Reuters on Monday.
Elliott plans to push Phillips 66 to sell or spin off its midstream business, the person said.
In March last year, Elliott accepted the performance improvement plan that Phillips 66 laid out to boost shareholder returns and share price, after the activist disclosed a $1 billion stake in the company.
Phillips 66 had appointed Robert Pease, a veteran refining executive, as a director and said it was looking to add a second candidate. Elliott had asked the firm to add directors with refining experience that could address underperformance in refining and speed up cost-cutting efforts.
The company’s shares closed at $163.34 apiece on March 28, 2024, days after Elliott accepted Phillips 66’s performance improvement plan. The stock closed at $123.71 on Monday.
Elliott plans to seek a number of changes to simplify Phillips 66, the Wall Street Journal, which first reported the story, said on Monday.
The activist investor believes the firm has not yet fulfilled its commitment to further board changes, WSJ said, adding that Elliott’s new position makes it one of Phillips 66’s top five investors.
Phillips 66 continues to welcome constructive dialogue with Elliott and all of our shareholders, the refiner told Reuters in an emailed statement on Tuesday.
Elliott has sought changes at several companies since last year, most recently taking a stake in oil major BP and boosting shares to their highest since August in early trade on Monday.
Last week, Honeywell split up into three independently listed companies after Elliott took a $5 billion stake in the industrial giant.
(Reporting by Shivani Tanna and Nilutpal Timsina in Bengaluru; Editing by Rashmi Aich and Vijay Kishore)
