Hess Corp. sent a letter to all shareholders, urging them to vote for the election of the board’s nominees.
The letter accompanied its definitive proxy materials filed in connection with its 2013 Annual Meeting of Shareholders, set for May 16, 2013.
“Your Board of Directors and management are committed to creating lasting value for all Hess shareholders,” the letter said. “Over the past several years, we have undertaken a series of initiatives to streamline our portfolio and transform Hess into a more focused, pure play exploration and production (“E&P”) company. Your vote on the WHITE PROXY CARD will help ensure that Hess has a Board of Directors focused on keeping our positive momentum going and creating lasting value for all Hess shareholders. We urge you to vote the WHITE PROXY CARD today.
“Despite the strong endorsement our plan has received from independent Wall Street analysts and our shareholders alike, Elliott Management— an activist hedge fund run by Paul Singer that only recently began accumulating Hess stock—is asking you to elect a slate of dissident directors who have already compromised their independence by agreeing to be paid directly by Elliott to support the hedge fund’s short term agenda. Under this highly unusual scheme, Elliott would control its directors by potentially paying them millions in cash to effectively dismantle Hess and all but foreclose the prospect of future value creation,” the letter said.
Elliott Management responded by sending its own letter to investors that defended itself against Hess’ criticism about Elliott’s idea of tying board compensation to share performance. In its letter, Elliott retorted that the performance pay would only kick in if Hess stock outperforms peers and at the end of a board member’s term, MarketWatch reported.