Elliott Said to Meet BHP Shareholders as Fund Urges Overhaul

(Bloomberg) -- Elliott Management Corp. is meeting with BHP Billiton Ltd. shareholders in Australia as the activist investor urges BHP to overhaul its businesses, a person familiar with the matter said.

Members of Elliott's BHP investment team, including James Smith who is heading the campaign and oversees Elliott's Hong Kong office, are going over details of their plan for Melbourne-based BHP with other shareholders, said the person, who asked not to be identified because the meetings are private.

New York-based Elliott, which owns a 4.1 percent stake in BHP, outlined proposals including a spinoff of BHP's U.S. oil assets in a letter made public on April 10. The activist fund also wants the company to combine its two legal entities listed in Sydney and London into one group headquartered in Australia. BHP responded by saying it's been in talks with Elliott for about eight months, and the costs and risks associated with the proposals outweigh the benefits.

James Agar, a spokesman for BHP, declined to comment.

BHP fell 0.5 percent to A$23.76 in Sydney on Tuesday, extending the decline this year to about 5 percent. That compares with the close on April 10 of A$25.73, when the shares jumped 4.6 percent on publication of Elliott's proposals.

The producer said last week it's seeking to divest as much as 50,000 acres (20,234 hectares) in a Texas gas field and may resurrect the sale of its under-performing Fayetteville shale gas assets in Arkansas. BHP has almost halved its U.S. shale portfolio since 2012, according to filings.

Activist investors typically meet with other shareholders to win support for changes at targeted companies. Elliott was founded by billionaire Paul Singer.

The Sydney Morning Herald earlier reported Elliott's planned meetings with shareholders in Australia.

--With assistance from David Stringer

To contact the reporter on this story: Beth Jinks in San Francisco at bjinks1@bloomberg.net.

To contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net, Jake Lloyd-Smith, Rebecca Keenan