Occidental Petroleum nears deal with Carl Icahn

Western Petroleum chief Vicki Hollub looks set to keep his job at the besieged oil producer a few days after Carl Icahn urged him to fire him as the company finalizes a deal with activist investor who would give him two seats on the board, said those informed. .

The truce between Occidental and the billionaire investor, who has shaken the company’s board of directors since he tried to block his $ 56 billion takeover of Anadarko Petroleum last year, aims to end months of public fighting and refocusing attention on reviving the business.

As part of the deal negotiated on Sunday, two close associates of the New York investor, Andrew Langham and Nicholas Graziano, will join the board of directors of Occidental, the people said. An additional board member could be added, who will be selected jointly by Mr. Icahn and the current board, the person added.

Mr. Icahn, who owns about 10 percent Occidental, sought to remove four directors from the company’s board of directors and pushed the company to sell. In response, the Western Council deployed a “poison pill” to prevent a hostile takeover orchestrated by Mr. Icahn.

Occidental also announced that the chairman of the board, Eugene Batchelder, will step down at this year’s board meeting. At the end of last week, it appeared that Stephen Chazen, who was the general manager of Occidental until 2016 and had chosen Ms. Hollub to replace him, would become the new president.

Chazen was determined to end the fight with Icahn before assuming this role, said people knowledgeable. However, he also said that Hollub kept her job under the truce agreement, the people added.

A person involved in the negotiations, who was first reported by the Wall Street Journal, warned that there had been a lot of back and forth between Mr. Icahn and the company’s board of directors and added that no final agreement had been reached. Any settlement would likely be announced on Monday after the markets close, the person added.

The collapse in oil prices, now below half their price in early January, has affected the entire US oil sector – but particularly affected Western, the United States’ largest producer of domestic oil.

The company cut its dividend by 90% at the start of the month and sharply cut planned spending for this year. Last week, the S&P rating agency lowered its junk debt to $ 37 billion, citing the strong leverage Westerners have acquired since buying Anadarko for $ 56 billion. last summer.

Its stock price has dropped by almost 70% in the past three weeks and its market capitalization is now less than $ 10 billion, compared to $ 42 billion just before its agreement to buy Anadarko in August 2019.

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