Elliott Management investment in Hess in 2013

Elliott Management invested in Hess Corporation in 2013 and made public a presentation for it. If you are interested to learn about how hedge funds write presentations, here is one for you to learn from.

About the Elliott Management deck(s)

All information is public information (I won’t share anything confidential on this site).

Deck one

This is the initial deck Elliott Management shared on Hess.

Deck two

This is the second deck from Elliott Management on Hess.

Deck three

This is the third deck from Elliott Management on Hess.

About the deal

In January 2013, Elliott Management, an activist hedge fund, made a strategic move by acquiring a 4% stake in Hess Corporation, a major player in the energy industry. This stake acquisition marked the beginning of a fierce proxy battle between Elliott and Hess, driven by Elliott’s critique of Hess’s management practices. Elliott’s criticism centered around Hess’s perceived lack of discipline and board accountability, particularly concerning its international expansion efforts and late entry into the lucrative shale oil market in North America.

As tensions escalated, Elliott Management took decisive action by assembling its own slate of directors, comprising seasoned industry veterans such as Rodney F. Chase, former deputy CEO of BP, and Harvey Golub, former chief of American Express. This move intensified the proxy fight, prompting Hess to respond with a series of asset sales and restructuring efforts in an attempt to appease shareholders and stave off Elliott’s demands for a company breakup. However, despite the heated negotiations, the standoff ultimately ended in a last-minute truce between Hess and Elliott, wherein three of Elliott’s nominees secured seats on Hess’s board while the hedge fund lent its support to Hess’s existing directors.

The resolution of the proxy battle between Hess and Elliott Management marked a significant moment in corporate governance, symbolizing the power wielded by activist investors in influencing strategic decisions within large corporations. The clash underscored the increasing trend of activist investors like Elliott seeking to unlock shareholder value by challenging traditional management practices and advocating for changes that could drive higher stock prices. Furthermore, the proxy battle highlighted the importance of board accountability and responsiveness to shareholder concerns in today’s competitive business landscape, where companies face mounting pressure to adapt to evolving market dynamics and investor expectations.

About Elliott Management

Elliott Management Corporation is a prominent American hedge fund founded by billionaire investor Paul Singer in 1977. With headquarters in New York City, Elliott is known for its activist investing approach, which involves taking significant stakes in companies and then actively engaging with management to push for changes aimed at increasing shareholder value. The firm has gained a reputation for its aggressive tactics and willingness to challenge corporate boards, often through shareholder activism campaigns and legal battles.

Over the years, Elliott Management has been involved in numerous high-profile activist campaigns targeting companies across various industries, including technology, finance, and energy. Some of its notable campaigns include pushing for strategic changes at companies like EMC Corporation, Compuware Corporation, and Arconic Inc. Elliott is also known for its involvement in distressed debt investing, where it acquires the debt of struggling companies and seeks to restructure their operations for profit. With its track record of successful activist interventions and its substantial assets under management, Elliott Management continues to be a significant player in the world of finance and investment.

About Hess Corporation

Hess Corporation, commonly known as Hess, is a leading global independent energy company engaged in the exploration, production, refining, and marketing of crude oil, natural gas, and petroleum products. Headquartered in New York City, Hess operates in several regions worldwide, with a primary focus on exploration and production activities in the United States, Guyana, and the Gulf of Mexico. The company’s upstream operations involve the exploration and development of oil and gas reserves, primarily through drilling activities. Hess also owns and operates refining and marketing assets, including refineries, terminals, and retail gasoline stations, primarily located on the East Coast of the United States. With a commitment to operational excellence, environmental stewardship, and social responsibility, Hess continues to play a significant role in meeting global energy demand while striving to minimize its environmental footprint and maximize value for shareholders and stakeholders alike.

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