(Bloomberg) -- Hess Corp., the oil producer targeted by hedge fund Elliott Management Corp., plans to shed about 300 jobs in 2018 as it seeks to cut costs by $150 million a year.
The layoffs are part of a cost-reduction program announced in October and will represent a 15 percent decrease in the New York-based company's workforce, based on the headcount at the end of 2017, said Lorrie Hecker, a spokeswoman for Hess. The company is also aiming to make reductions in its contractor base, she said. Reuters reported the plan earlier.
“We moved aggressively in 2017 to focus and high-grade our company's portfolio," Hecker said Tuesday. "The combination of this cost reduction program and our high-graded portfolio is expected to drive down cash unit production costs by approximately 30 percent" by 2020.
Last month, Elliott called for Chief Executive Officer John Hess to fix the oil producer his father founded or get out. The feud between Elliott and Hess goes back at least four years. The fund is calling for Elliot to sell assets in Southeast Asia and wants the company to focus on share buybacks instead of dividends.
Hess estimates that its drive to reduce costs will save about $150 million a year starting in 2019, Hecker said. Shares of the company fell 1.8 percent to $53.54 in New York on Tuesday.
--With assistance from Scott Deveau
To contact the reporter on this story: Ryan Collins in Houston at rcollins74@bloomberg.net.
To contact the editors responsible for this story: Reg Gale at rgale5@bloomberg.net, Carlos Caminada, Joe Carroll
©2018 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
