(Reuters) – Billionaire investor Carl Icahn on Wednesday ratcheted up his fight with Occidental Petroleum over its pending buy of rival Anadarko Petroleum by calling for a particular shareholder assembly the place he hopes to win board seats.
FILE PHOTO: Investor Carl Icahn responds to a query at a gathering to announce the findings of the Lazard Report in New York, February 7, 2006. REUTERS/Jeff Zelevansky
In a regulatory submitting, Icahn stated he deliberate to oust and exchange 4 Occidental administrators and alter the corporate’s constitution by means of a stockholder consent solicitation to stop it from ever engineering the same takeover once more.
Responding to the submitting, Occidental stated it can evaluation the most recent supplies filed by Icahn, and appears ahead to addressing them in ongoing conversations with shareholders.
Icahn, considered one of trade’s strongest activist traders, solid himself as one of many deal’s most fervent critics by charging that Occidental’s $38 billion bid for Anadarko was too costly and will endanger Occidental’s future if oil costs sink.
The deal has been authorised by the U.S. Federal Trade Commission and is anticipated to shut within the second half of the yr.
Icahn’s transfer on Wednesday put contemporary stress on Occidental’s administration and Chief Executive Vicki Hollub at a essential time and has sparked hypothesis that Occidental might attempt to settle with him.
“It is important to add new directors to Occidental’s Board of Directors to oversee future extraordinary transactions like the Anadarko transaction and to ensure that they are not consummated without stockholder approval when appropriate,” Icahn stated in an announcement to shareholders on Wednesday.
Icahn owned a $1.6 billion stake in Occidental as of May 30.
While the transfer was notable, it hardly got here as a shock as Icahn had been hinting for weeks that he may push for a particular assembly the place different shareholders would be capable to categorical their frustration with administration.
In May he sued Occidental in Delaware courtroom, and earlier this week he went out of his strategy to criticize the Occidental-Anadarko deal whereas discussing the merger of main on line casino operators Caesars Entertainment Corp and Eldorado Resorts Inc.
“The recent Occidental Petroleum fiasco is a great example of how CEOs and boards will go to great lengths, including ‘betting the company’ to serve their own agendas,” Icahn stated in an announcement concerning the Caesars-Eldorado merger. “If their bet is successful, they and possibly their shareholders win, but if it is unsuccessful, only the shareholders lose.”
While Icahn has stated publicly that the Occidental-Anadarko deal possible wouldn’t be derailed, his submitting illustrates how he wants to ensure that nothing related occurs once more.
He stated Occidental lacks efficient company governance and that its administrators made errors in how and at what value they pursued the acquisition of Anadarko, in line with the submitting.
Icahn is asking on the board to set a file date to find out which shareholders might petition to carry a particular assembly.
The oil and gasoline producer’s bid for Anadarko topped one by Chevron Corp and features a $10 billion financing deal with Warren Buffett’s Berkshire Hathaway Inc.
The merger of the 2 U.S. shale producers would improve Occidental’s debt to round $40 billion. Icahn, in his lawsuit filed in Delaware Court of Chancery in May, sought entry to the oil producer’s monetary information and particulars of negotiations.
Reporting by Svea Herbst-Bayliss in Boston and Arundhati Sarkar in Bengaluru; Editing by Richard Chang and Leslie Adler