June 28 (Reuters) - Proxy adviser Institutional Shareholder Services urged investors of natural gas producer EQT Corp to vote in favor of all nominees of shareholders Toby and Derek Rice.
The Rice brothers, who own about 3% of EQT, were part of the founding team at Rice Energy, which EQT bought in November 2017. They hold EQT management responsible for its underperformance since the merger and have been pushing for a change in EQT’s strategy and a shakeup of its 12-member board.
EQT shares have lost nearly 59% since the completion of the Rice merger, compared with a 8.8% fall in the broader S&P Energy Index during the same period.
Last month, under pressure from shareholders, EQT replaced three long-serving directors, following which the Rice brothers cut their nominees to the company’s board from nine to seven.
“Although the board has undergone considerable refreshment since the 2017 merger...the significant value destruction overseen by legacy directors in the interim poses a question to shareholders,” the ISS report said.
ISS said on Friday that shareholders should support all seven nominees by Rice brothers and five existing members of the board it backs.
Responding to ISS’ recommendations, Toby Rice said, “this clearly affirms that the Rice Team’s plan is the only viable path towards transforming EQT into a modern, low-cost gas operator and realizing the potential of the merger with Rice Energy”.
EQT did not immediately respond to Reuters’ request for comment. (Reporting by Debroop Roy in Bengaluru; Editing by Shinjini Ganguli)