Refining: Marathon: Marathon Petroleum Weighs Sale of Two Refineries

Recommended Posts

(Bloomberg) -- Marathon Petroleum Corp., the U.S. oil refiner under pressure from activist investor Elliott Management Corp. to break itself up, is weighing the sale of two plants in Alaska and Utah, according to people familiar with the matter.

The Findlay, Ohio-based company is in active discussions with possible buyers for its 68,000-barrel-per-day Kenai oil refinery near Anchorage and its 58,500-barrel-per-day Salt Lake City refinery, the largest in the Utah, said the people, who asked to not be identified as the discussions are private.

A Marathon representative declined to comment on the refineries. The company said last week in a statement it’s carrying out a “comprehensive strategic review.”

The Kenai plant is among “several logical non-core” assets flagged for sale by Elliott in a presentation published last month. The investor is also demanding the breakup of Marathon into three segments -- refining, midstream and retail -- which it says would unlock more than $22 billion in value.

It’s unclear how much the two plants might fetch in a sale. In May, Chevron Corp. bought the Pasadena refinery, which has a 110,000-barrel-per-day capacity, for $350 million.

Hedge fund D.E. Shaw & Co. has also been pushing the refiner to explore ways to unlock value. Marathon investors Paul Foster and Jeff Stevens have called for the ouster of Chief Executive Officer Gary Heminger. Marathon met with all three activists last week to discuss Heminger’s future and the company’s strategy.

Marathon is due to report its third-quarter earnings and hold a conference call with analysts and investors on Oct. 31.

Shares of the company were 1.1% higher at $65.36 at 11:20 a.m. in New York.

Share this post

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

You are posting as a guest. If you have an account, please sign in.
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.