Hartley to Step Down as Unocal Chief; Will Still Be Its Chairman
Fred L. Hartley, 71, the outspoken oilman who presided over Unocal Corp. for 23 years and guided it past the clutches of T. Boone Pickens Jr. in an epic takeover battle in 1985, will give up day-to-day managerial control of the company on Aug. 1, Unocal announced Monday.
Hartley will remain as chairman indefinitely, but turn over the post of chief executive to Richard J. Stegemeier, the current president and chief operating officer.
Hartley’s departure had been rumored for months, and there had been speculation that board members urged him to step aside. A controversial executive who is said to rule Unocal with an iron hand, he wasn’t a favorite of the investment community or of oil industry critics.
“If Fred had his druthers, he’d rather be president for life,” said one close follower of Unocal. “I don’t believe Fred had control over his own destiny.”
However, Unocal said Hartley had recommended the elevation of Stegemeier, 60. Hartley himself will retire as an employee no later than Nov. 30, but his tenure is chairman is open-ended, the company said.
It seemed in keeping with Hartley’s style that he will hang onto the chairman’s post, and some analysts were skeptical that the change would make much immediate difference at Unocal. Some questioned whether Hartley will truly relinquish control.
“He’s sort of easing himself out,” said M. Craig Schwerdt, an oil analyst at Morgan Olmstead Kennedy & Gardner. “He’ll still have an influence.”
However, analyst Bernard Picchi of Salomon Bros. in New York, whose written analyses of Unocal had speculated about Hartley’s departure in recent months, said the move will mark a sharp change.
“I think it’s a very significant change,” Picchi said. “They’re turning over the reins to a new generation. This is a company that has to take a harder look at the premises under which it does business, and I think Dick Stegemeier is just the one to do it.”
Could Become Target
Picchi and others have criticized Unocal management--that is, Hartley--since it was forced to take on a heavy debt load in fending off the Pickens takeover attempt. The priority, Picchi said, will be to revitalize the refining and marketing arm.
The change at Unocal could revive interest in Unocal as a takeover target as well. The company’s strong West Coast position in retail gasoline and its three California refineries are the envy of such companies as British Petroleum, which is looking for outlets for its huge Alaskan oil reserves.
Hartley joined Unocal in 1939 and has been running it since 1965, building up a company that Salomon Bros. believes would fetch at least $7.3 billion if it were broken up and sold in pieces.
One of the best-known episodes involving Hartley was based on his being misquoted at the time one of Unocal’s offshore oil platforms caused the landmark 1969 oil spill off the Santa Barbara coast.
“I’m amazed at the publicity for the loss off a few birds,” Hartley supposedly told a Senate hearing on the spill. He didn’t say it, but the comment became part of the lore recited by critics of the oil industry.
Hartley has won both praise and scorn for his determination in continuing with a government-backed oil shale project in Colorado that cost Unocal more than $650 million. He has also been among the most outspoken industry leaders in calling for an oil import fee or other aid for the industry since the 1986 collapse of oil prices.
