Elliott proposes new directors for Phillips 66 board

WEST PALM BEACH, Fla. - Elliott Investment Management L.P., an asset management firm, has announced its intention to nominate four independent directors to the board of Phillips 66 (market cap: $49.8 billion), aiming to drive positive change and create shareholder value. According to InvestingPro data, Phillips 66 currently trades at $122.18, showing a 9.25% gain year-to-date despite broader market challenges. The nominees, Brian Coffman, Sigmund Cornelius, Michael Heim, and Stacy Nieuwoudt, bring a diverse set of skills to the table, with experience in refining, corporate transformations, midstream operations, and energy sector investment.

In a letter to Phillips 66 shareholders, the nominees expressed their belief that improving operational excellence, accountability, and corporate governance could close the performance gap between Phillips 66 and its competitors. With annual revenue of $137.77 billion and a FAIR financial health score from InvestingPro, the company offers a compelling 3.93% dividend yield. The nominees emphasized their readiness to work with the incumbent directors and stressed the potential for Phillips 66 to return to its position as an industry leader.

The announcement comes ahead of the company’s Annual Meeting scheduled on May 21, 2025. Elliott, which manages funds making it a top-five shareholder in Phillips 66, is asking shareholders to vote on the Gold Card for its nominees. The firm manages approximately $72.7 billion in assets and has been one of the longest-standing funds under continuous management since its founding in 1977.

Elliott’s definitive proxy statement and accompanying GOLD universal proxy card have been filed with the Securities and Exchange Commission (SEC) to solicit proxies for the election of its slate of director candidates at the Annual Meeting. Shareholders have been advised to read these documents, as they contain important information about the participants in Elliott’s proxy solicitation.

The move by Elliott represents a strategic effort to influence the direction of Phillips 66, a company with a storied legacy and high-quality assets. The nominees are poised to bring fresh perspectives to the board, aiming to enhance the company’s credibility with shareholders and evaluate its current structure and operations critically. InvestingPro analysis suggests the stock is currently undervalued, with analysts setting price targets ranging from $110 to $153 per share. Get access to the full Phillips 66 Pro Research Report, along with detailed analysis of 1,400+ other US stocks, exclusively on InvestingPro.

This article is based on a press release statement from Elliott Investment Management L.P.

In other recent news, Phillips 66 has announced a significant transaction involving its retail marketing business in Germany and Austria. The company agreed to sell a 65% interest to a consortium led by Energy Equation Partners and Stonepeak, while retaining a 35% stake through a new joint venture. This move is part of Phillips 66’s strategy to optimize its portfolio and enhance shareholder value. The enterprise value of this business is approximately €2.5 billion, with Phillips 66 expecting to receive pre-tax cash proceeds of about €1.5 billion, which will be used for strategic priorities like debt reduction.

Additionally, TD Cowen analyst Jason Gabelman raised the price target for Phillips 66 to $120, maintaining a Buy rating. This comes as the company prepares for its Annual Meeting, where activist investor Elliott Management is pushing for changes in corporate governance. Phillips 66 has defended its current strategy, emphasizing its improved refining operations and shareholder returns. The company has also publicly disagreed with proxy advisors ISS and Glass Lewis on board nominations, asserting the strength of its current board.

Phillips 66’s board has rejected Elliott’s proposal to break up the company, arguing that the integrated business model provides stability. The company continues to focus on refining performance, noting a 15% reduction in Refining Adjusted Controllable Costs since 2022. These developments highlight Phillips 66’s efforts to maintain its strategic direction and shareholder engagement amidst external pressures.

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