{ "docId": "019dd923-622b-71dc-a6d8-dad031a83edd", "docSlug": "843b712a7e02", "documentTitle": "Phillips 66 (PSX)", "authorId": "02_Elliott_Management", "authorName": "Elliott", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "activist_investor", "sourceTypeLabel": "Activist investor", "presentationDate": "2025-04-28 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 107, "pageCount": 138, "prevPage": 106, "nextPage": 108, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 3, "notes": "Uses a two-column 'rebuttal' structure to contrast the company's claim against the reality of the situation.", "elementsJson": [ "headline_text", "paragraph", "bullet_list", "callout_box", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622b-71dc-a6d8-dad031a83edd/107", "deckHref": "/decks/019dd923-622b-71dc-a6d8-dad031a83edd", "deckJsonHref": "/decks/019dd923-622b-71dc-a6d8-dad031a83edd.json", "deckAnchorHref": "/decks/019dd923-622b-71dc-a6d8-dad031a83edd#slide-107", "components": [ { "bbox": { "h": 0.08, "w": 0.45, "x": 0.52, "y": 0.78 }, "kind": "callout", "text": "WE INVITE THE COMPANY TO SHARE ITS TAX WORK WITH ALL SHAREHOLDERS. THE COMPANY'S TAX BASIS IS NOT COMMERCIALLY SENSITIVE OR MNPI.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "4565c5a4-ef8b-4f25-a5a1-565e3a684bb3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.45, "x": 0.05, "y": 0.78 }, "kind": "callout", "text": "ELLIOTT HAS WORKED WITH A TOP ACCOUNTING FIRM WHICH HAS PERFORMED AN OUTSIDE-IN ANALYSIS TO CONFIRM THAT NONE OF THESE ARE TRUE.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "912ed5f2-2b0d-42b7-be32-4650000f5a5a", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.45, "x": 0.05, "y": 0.48 }, "kind": "list", "text": "Despite having >$15bn of estimated liabilities at the midstream entity including PSXP and DCP debt, working capital and other liabilities, there is minimal tax basis attributed to the liabilities", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "56889bdf-43bd-4df8-ad4d-7f5371e7a5b7", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.45, "x": 0.05, "y": 0.63 }, "kind": "list", "text": "The tax basis of the non-DCP or PSXP assets (which are the minority of midstream assets) has >$15bn of negative basis as to outweigh the >$15bn of liabilities associated with the midstream business", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "766de02b-cd19-4572-bdfe-6ee4d0fceb85", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.45, "x": 0.52, "y": 0.58 }, "kind": "list", "text": "Avoiding focusing on a tax-free spin as a valid option, if remarkably tax leakage proves substantial", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8bf5fe7f-f2e6-47be-9c8b-9f348e02f7b2", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.2, "w": 0.45, "x": 0.05, "y": 0.28 }, "kind": "list", "text": "For this to be true, you need to believe the following: Despite Phillips 66 publicly confirming that the acquisitions of DCP (2023) and PSXP (2022) were taxable transactions, thereby stepping up the basis of the majority of midstream assets, these assets have minimal tax basis today", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a1f222d1-9c33-4b67-98f2-08e67650ffb7", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.1, "w": 0.45, "x": 0.52, "y": 0.45 }, "kind": "list", "text": "The Company has performed the tax analysis, but is hiding the result from shareholders as it does not support their narrative", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a9c42034-23fb-4c3e-88f0-63d6cd8b655c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.45, "x": 0.52, "y": 0.28 }, "kind": "list", "text": "OR: Phillips is not prioritizing shareholder interests: Despite claiming they have actively evaluated a sale of midstream, Phillips 66 has not performed a reasonable tax analysis for the transaction because they never seriously considered it", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fd5274fc-a8b5-4274-9537-09828210d215", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "metric", "text": "tax leakage: $10bn", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd953-14da-72ce-9fa7-dc1a8c11040a", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.9, "x": 0.05, "y": 0.16 }, "kind": "paragraph", "text": "Phillips 66 has claimed that in a $50bn TEV midstream sale, “tax leakage costs could be as high as $10 billion.”(1) This would require that there is little tax basis in the $50bn asset. This is highly unlikely if not impossible.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "95dafbc2-7842-4e67-862e-7b7727c54e36", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.9, "x": 0.05, "y": 0.88 }, "kind": "paragraph", "text": "Our in-depth work, confirmed by multiple accounting experts, has shown that the taxes for a potential sale are likely to be materially lower than $10bn. Phillips 66 could also separate its midstream business via a tax-free spin.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a9741ef6-9f83-487c-8145-3fd6bcc047ad", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "Phillips 66 has claimed that in a $50bn TEV midstream sale, “tax leakage costs could be as high as $10 billion.” — Phillips 66 Letter to Shareholders, 4/8/25.", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-14da-72ce-9fa7-d87b7df6570b", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.3, "x": 0.05, "y": 0.95 }, "kind": "source-note", "text": "(1) Phillips 66 Letter to Shareholders, 4/8/25.", "attrs": { "numbered": true }, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "78d0e4b8-b2cc-4cbe-9536-cf0e6d7054d3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.1, "w": 0.9, "x": 0.05, "y": 0.05 }, "kind": "title", "text": "CLAIM: MIDSTREAM SALE COULD RESULT IN LEAKAGE UP TO $10BN REALITY: LEAKAGE IS OVERSTATED; TAX-FREE SPIN ON THE TABLE", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "94deba4c-6716-4d80-b8a9-95f35f29efc2", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "preempt_rebuttal", "slug": null, "matchId": "1482886e-b603-4edd-a2cf-b53de9ccf489", "evidence": "The slide systematically breaks down the company's claim and provides counter-arguments.", "confidence": 0.9 } ], "arcBeats": [], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }