Elliott Investment Management has accumulated a stake worth more than $2.5 billion in oil refiner Phillips 66 and intends to push the company to sell or spin off its midstream business. The activist investor, known for its aggressive strategies, is seeking to simplify Phillips 66’s operations and improve shareholder value.
According to a source familiar with the matter, Elliott plans to seek significant changes at Phillips 66, including more board adjustments and a focus on refining operations. The firm believes that the company has not fully followed through on its earlier commitments to board changes. This new move follows a previous stake of around $1 billion that Elliott disclosed in 2023.
Shares of Phillips 66 surged by as much as 7.1% in premarket trading, reflecting investor optimism in response to Elliott’s involvement. Last year, Phillips 66 and Elliott agreed to appoint Robert Pease, a former Shell Trading Co. executive, to the board to strengthen the company’s refining expertise.
Additionally, Phillips 66 has been engaged in a multi-year initiative to cut costs and raise capital by selling assets. Under pressure from Elliott, the company has already sold about $2.7 billion in assets since 2022. The activist investor sees a potential 75% increase in Phillips 66’s stock price by focusing on its core refining business and making other strategic changes.
Elliott’s move comes as it continues to exert influence over the company, with its larger stake marking a significant step in its efforts to unlock value for shareholders.
