Phillips 66 is arguing that Elliott Investment Management should back down from its push to break up the energy company because the activist investor is conflicted from a separate effort to acquire one of Phillips 66’s rivals, according to a letter seen by Reuters.
The salvo from Phillips 66, which is expected to be revealed in a letter later on Monday, is the latest in a bitter spat between the firm and Elliott that is due to come to a head at Phillips 66’s shareholder meeting next month.
In arguing against Elliott’s break-up thesis in the letter, Phillips 66 said the investment firm has a conflict of interest over the best strategy for the company due to its separate efforts to buy Citgo Petroleum.
The parent company of Citgo is being sold via a court-supervised auction. Last year, Amber Energy, backed by Elliott, was initially deemed the winner of the process, before creditor challenges forced the court to backtrack and launch a new sale effort.
The chief executive of Amber Energy, Gregory Goff, said on April 9 he had bought a position in Phillips 66 and backed Elliott’s campaign.
“This conflict is concerning because Amber Energy’s executives are actively helping support Elliott’s case to undermine Phillips 66’s strategy,” said Monday’s letter from Phillips 66.
Phillips 66 is one of the largest U.S. refiners, while Citgo is the seventh largest.
Elliott has put forward four director nominees for the May 21 meeting, as part of a campaign that has also included calling on Phillips 66 to sell or spin off its midstream business and consider divesting other assets that would allow it to focus on its refining business and boost its share price.
Elliott has said it has an investment worth more than $2.5 billion in Phillips 66. It is the second time the investment firm has pushed for change at Phillips 66, after a first effort ended in early 2024 with the addition of a new company board member blessed by Elliott.
(Reporting by David French in New York; Editing by Leslie Adler)