Exxon Meeting Halts With Late Votes Being Tallied Amid Feud

(Bloomberg) -- Exxon Mobil Corp. halted its annual shareholders meeting Wednesday to give the company more time to count the votes, indicating a proxy fight with an activist investor is finely poised.“Given there are considerable number of votes still coming in and we want to ensure all of our shareholders have the opportunity to express their views, we will now take a one hour recess,” Stephen Littleton, head of investor relations, said during the virtual meeting.Shareholders were given the opportunity to vote on a slate of four dissident nominees proposed by Engine No. 1, an investment firm pushing for Exxon to make changes to its financial and climate strategies. The meeting is set to resume at 11:15 a.m. Dallas time.Engine No. 1’s campaign has won backing from several institutional shareholders and partial support two prominent proxy advisory firms. The election of just one of the four nominees would be an unprecedented event for Exxon, which has endured a difficult few years amid low oil prices, a string of losses and a record writedown on some of its assets.Earlier on Wednesday, Engine No. 1 issued a statement urging investors not to change their vote. It said Exxon was trying to persuade shareholders to change their vote in a way that would lessen the overall tally for one or more of its nominees that would otherwise have been added to the board.Following the start of recess, the investment firm said the move was a “last-ditch attempt to stave off much-needed board change.”“In seeking to delay the closing of the polls, ExxonMobil is using corporate machinery for its own purpose rather than that of shareholders and avoiding the election of individuals with the transformative energy experience required to position the Company for long-term success in a changing world,” it said.By taking additional time to count votes, Exxon may be trying to avoid a similar situation to what happened to Procter & Gamble Co. in 2017, when the company prematurely declared victory in fending off billionaire investor Nelson Peltz in his battle for a board seat.In that case, Peltz refused to concede defeat, and a month later an independent inspector overturned the original tally. Peltz then claimed his seat with a margin of 42,780 votes, or roughly 0.0016% of the consumer giant’s outstanding shares, the inspector determined.Similar situations have occurred in the past. In 2014, activist investor Sandell Asset Management Corp. claimed it had won at least five of the eight seats it was seeking at Bob Evans Farms Inc. before the official tally showed it won four.In 1996, investors Carl Icahn and Bennett S. Lebow won a nonbinding shareholder vote at RJR Nabisco Holdings Corp., supporting the rapid spinoff of the company’s food business from its tobacco unit. The company had previously said it won, based on the preliminary results of the vote.(Updates with comment from activist in sixth paragraph)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.