(Bloomberg) -- EQT Corp., the largest U.S. natural gas producer, has won the support of a prominent shareholder advisory firm that recommended shareholders support its slate of directors over another being presented by dissident shareholders.
Glass Lewis & Co. said in a report Friday that the company was headed in the right direction after changes to management and the board in recent months. It recommended shareholders not support an effort to replace the majority of the board by stakeholders Toby and Derek Rice.
"We see no significant outstanding concerns regarding leadership or governance at EQT and we do not believe further board refreshment or oversight is warranted at this juncture," Glass Lewis said in its report.
The report is at odds with another advisory firm, Institutional Shareholder Services, which recommended investors support all seven Rice nominees.
The Rice brothers have been pushing to revamp the board and management, arguing the company has underperformed and is need of an overhaul.
EQT has argued the Rice brothers simply want to make the gas producer a “family business” by appointing 15 former employees of Rice Energy to management roles. The company has argued that their plans would destabilize the business and are unmanageable. EQT also has noted it's taken steps to refresh its board, replacing nine of its 12 directors since 2017, including three long-tenured ones last month.
“The recommendation reaffirms that EQT has the right Board, management team and strategy to continue its successful transformation and create significant long-term shareholder value,” the company said in a statement.
The Rice brothers weren't immediately available for comment.
Glass Lewis said in its report that the current leadership should be given more time for its turnaround.
"Ultimately, we believe this contest has placed additional pressure on EQT leadership to deliver operational efficiencies and we believe it would be reasonable for shareholders to provide management and the board with additional time to achieve target savings before seeking further change," Glass Lewis said in its report.
To contact the reporter on this story: Scott Deveau in New York at sdeveau2@bloomberg.net
To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Matthew G. Miller, Linus Chua
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