Occidental Leaders Push Shareholders to Reject Carl Icahn's Board Shakeup Plan
July 22 2019 - 1:12PM
Dow Jones News
By Dave Sebastian
Leaders of Occidental Petroleum Corp. are pushing their
shareholders to reject billionaire investor Carl Icahn's bid to
replace four directors at the company, urging them to not sign Mr.
Icahn's written requests for a board shakeup.
Last week, Mr. Icahn and his multiple affiliates filed a
solicitation statement with the U.S. Securities and Exchange
Commission for the board reorganization.
Mr. Icahn said the company's current directors made a number of
mistakes in pursuing Anadarko Petroleum Corp. Occidental is set to
acquire Anadarko for $38 billion, after waging a bidding war with
Chevron Corp. In a letter Monday, Mr. Icahn echoed his criticism of
Occidental's planned acquisition.
Occidental's most recent annual meeting was in early May and
another director election about 10 weeks later isn't in
Occidental's and stockholders' best interests, said Vicki Hollub,
Occidental's president and chief executive officer, and Eugene
Batchelder, Occidental's board chairman, in a shareholder
letter
Ms. Hollub and Mr. Batchelder said in the letter that Mr. Icahn
doesn't understand the strategic or financial merits of the
Anadarko deal.
They also said they believe Mr. Icahn's board nominees would
interfere with Occidental's ability to integrate Anadarko's assets
and complete its divestiture and deleveraging plan.
Mr. Icahn's nominees include Nicholas Graziano, a portfolio
manager at Icahn Capital, and Andrew Langham, general counsel of
Icahn Enterprises LP.
Mr. Icahn is also nominating John Hofmeister, the founder and
chief executive officer of not-for-profit association Citizens for
Affordable Energy and a former president of Shell Oil Co., and Alan
LeFevre, a board member of Herbalife Nutrition Ltd. and former
chief financial officer of Jarden Corp.
Through his various affiliates, Mr. Icahn has about a 4.4% stake
in Occidental.
In buying Anadarko, Occidental is gaining prized assets in the
Permian Basin of West Texas and New Mexico.
Chevron had agreed to purchase Anadarko for about $33 billion on
April 12, but Occidental offered the oil company $38 billion on
April 24 and then sealed its bid by boosting the cash portion of
its offer. Occidental's deal with Anadarko is expected to close in
the second half of 2019.
A number of large Occidental shareholders, including T. Rowe
Price Group Inc., opposed the deal over and voted against board
members at the company's annual meeting. The mutual-fund giant and
other investors said they were dismayed that Occidental's use of
external financing would allow the company to avoid a shareholder
vote on the transaction.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
July 22, 2019 12:57 ET (16:57 GMT)
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