(Oil Price) – Elliott Investment Management is at it again, this time sinking its teeth into U.S. refiner Phillips 66 with a $2.5 billion stake and a laundry list of demands.
The aggressive activist investor—best known for shaking up boardrooms and strong-arming CEOs into “unlocking value” (i.e., making changes that boost Elliott’s returns)—wants Phillips 66 to spin off its midstream business and tighten up operations.
If this feels like déjà vu, that’s because it is. Elliott first made its presence known at Phillips 66 last year with a $1 billion stake and a push for refining expertise on the board. The company played nice, appointed veteran Robert Pease as a director, and promised to consider another addition. Fast forward to today, and it looks like Elliott isn’t thrilled with the progress—especially since the stock has tanked from $163 in March 2024 to $123 now.
Phillips 66, for its part, is keeping things diplomatic, saying it “welcomes constructive dialogue” with Elliott. That’s investor relations speak for “we know they’re not going away, so let’s not start a fight—yet.”
But Elliott doesn’t show up just to chat. It plays for control. And given its track record, Phillips 66 execs are probably sweating. Just ask BP, where Elliott very recently took a position and promptly started agitating for a strategic reset. Or Honeywell, which ended up splitting into three companies after Elliott grabbed a $5 billion stake. Or Suncor, where it took a $3 billion position.
So what’s next? If history is any guide, Phillips 66 should brace for turbulence. A spinoff of its midstream assets might be just the beginning—especially if Elliott decides a broader shakeup is in order.
One thing’s for sure: Elliott has no patience for underperformance. And right now, Phillips 66 is in its crosshairs.
By Julianne Geiger for Oilprice.com
