Hess Corp.’s decision to reject board nominees proposed by Elliott Management Corp. and exit its gasoline-station and energy trading businesses isn’t sufficient to resolve shareholder concerns about the company, Relational Investors LLC said.
“They’re trying to do the minimum they can do to win a proxy contest,” David Batchelder, a co-founder of the San Diego-based company, said of Hess in a phone interview today. “We want them to focus on improving their board. Certainly Elliott has a lot of very qualified nominees and they need to reach out to Elliott.”
Hess yesterday proposed a slate of six new board members and said it would exit the other businesses as it transforms to an oil exploration and production company. Paul Singer’s Elliott Management, which owns a 4 percent stake in New York-based Hess, said the changes announced yesterday fall “dramatically short.”
Batchelder said in a letter to Chairman and Chief Executive Officer John Hess today that the company should appoint “some or all” of Elliott’s nominees to the board. Relational, which owns a 2.7 percent stake in Hess, and other shareholders “will overwhelmingly support” those proposed members, he wrote.
Hess said shareholders do support its decisions and board nominees.
“Despite the letter released by Relational, Hess has been overwhelmed by the support it has received from its shareholders to yesterday’s announcements regarding the culmination of its five-year transformation into a focused higher growth pure play E&P company,” Jon Pepper, a company spokesman, said in an e-mailed statement.