* Three-quarters of votes went against Irani
* Ex-ambassador Djerejian is new independent chairman
* Clears path for Chazen to cut costs before 2014 departure
* Chazen emotional, amusing in farewell to Irani
* Shares rise nearly 3 pct
By Braden Reddall
SANTA MONICA, Calif., May 3 Occidental Petroleum
Corp shareholders voted to oust Executive Chairman Ray
Irani after more than two decades of leading the fourth-largest
U.S. oil company, in a jarring corporate end ahead of his
planned retirement next year.
The company had been forced to deny there was a fight at the
top after the Wall Street Journal reported pressure from Irani
for Chief Executive Steve Chazen to leave, even though Chazen
had the support of several big investors.
More than three-quarters of the votes cast went against
Irani, according to a tally released late on Friday. Earlier,
Chazen had said at the annual shareholder meeting that Irani
would step down from the board.
Edward Djerejian, a former ambassador, will take over as
independent chairman of the Los Angeles-based company. A
director since 1996, he most recently chaired the corporate
governance, nominating, and social responsibility committee.
Shares of Occidental rose nearly 3 percent to close at
$90.76 on the New York Stock Exchange.
"Ultimately this clears the path for Chazen to continue what
he is focusing on so far, which is cost improvement," said Allen
Good, an oil company analyst at Morningstar in Chicago. "It also
might clear the way for the break-up of the company. They are
much bigger now, so it might make sense to create a couple of
different companies out of Oxy."
Chazen spoke at length on a conference call last week about
the potential shape of a sale of its Middle East businesses,
long more favored by Lebanon-born Irani.
On Friday, while still displaying his well-known sense of
humor, Chazen talked emotionally of his two-decade relationship
with the 78-year-old chairman. "I'm not going to say that every
day was a trip to Disneyland," he said, before adding: "Every
day I learned something."
Irani took over as CEO in 1990 from tycoon Armand Hammer -
a time when Chazen said the nicest thing you could say about the
company was it was "nearly insolvent" - and oversaw dramatic
growth, while raising eyebrows with his lavish pay packages.
In a call at the meeting for better governance, shareholder
John Chevedden pointed to what Irani received for financial
planning: $390,000 last year. About 63 percent of shareholders
backed the latest executive compensation plan in an advisory
vote on Friday.
Chazen, 66, took over as CEO two years ago, having served in
the executive suite since 1994. Occidental revealed in February
it was seeking his replacement, and then said in April that he
would continue through 2014, in order to reduce uncertainty.
Referring to the very public succession battle, Chazen said
"it's been tough to tell the last few weeks" that oil and gas is
the company's primary business.
Chazen received more shareholder support than any other
boardmember, at 623.2 million votes - nearly 99 percent.
The CEO went on to say he would still ask Irani for advice
regularly "because I'm addicted to it" and concluded his remarks
by thanking his wife for "letting me fool around a little
Influential advisory firm ISS this week had reaffirmed its
recommendation to vote against Irani.
"I didn't see anybody predicting that he would be forced,"
said Jack Zwingli, leader of information services at Farient
Advisors, an independent executive compensation consulting firm.
"Most people would take it as a surprise."
Zwingli said investors would watch to see if the pay package
of the next CEO is brought down to the level of Occidental's
The chairman of Occidental's compensation committee, Aziz
Syriani, withdrew his nomination prior to the election, and
Chazen said that a search firm would start working on
replacements for open board seats.