The Rising Influence of Rising Affluence

[DewDiligence]

More on today’s two HES stories:

http://www.reuters.com/article/2013/01/28/hesscorp-deal-idUSL4N0AX4F020130128 (Reuters)

http://online.wsj.com/article/SB10001424127887323375204578269893080557894.html (WSJ 1)

http://blogs.wsj.com/deals/2013/01/28/elliott-targets-stake-in-hess-which-announces-more-restructuring (WSJ 2)

http://www.bloomberg.com/news/2013-01-28/hess-to-pursue-sale-of-terminal-network-exit-refining-business.html (Bloomberg)

http://www.forbes.com/sites/afontevecchia/2013/01/28/hess-selling-downstream-assets-to-focus-on-shale-as-billionaire-paul-singer-looks-to-shake-things-up (Forbes)

http://finance.yahoo.com/news/hess-pursue-sale-terminal-network-133000148.html (HES’ own PR re exit from refinery/terminal business)

http://finance.yahoo.com/news/hess-announces-receipt-notices-elliott-134000800.html (HES’ own PR re approach by Elliott)


SUMMARY

HES is selling not only its Port Reading, NJ refinery, but also 19 oil-storage terminals on the East Coast and one terminal in the Caribbean. The storage terminals were used to support HES’ refining JV with Venezuela in the Virgin Islands, which has been discontinued; hence the terminals are no longer useful for HES.

However, HES is keeping its network of retail service stations and convenience stores, at least for now. (HES is the #1 player in convenience stores in the Northeast.)

Elliott Associates, in addition to seeking $800M of HES stock, says it may push for BoD representation at HES’ annual meeting. Whether this relationship becomes friendly or hostile remains to be seen.