Billionnaire investor activist Carl Icahn has won a small victory at Forest Laboratories’ AGM after one of his four nominees was voted onto the group’s management board.
The company said that preliminary results indicate that Icahn nominee Pierre Legault has been elected to the 10-member Board.
Legault will be taking over from long-serving director Dan Goldwasser, who is currenty chairman of the compensation committee.
However, the rest of Icahn’s team – Eric Ende, leader of the proxy fight, Andrew Fromkin and Daniel Ninivaggi – did not make it in, indicating that shareholder support for Icahn’s attack on Forest’s management was perhaps not as strong as he had hoped.
Nevertheless, Icahn called Legault’s victory “surprising”, as “a few shareholders with upwards of 25% of the outstanding shares seem to vote in favor of management no matter how bad the company is performing and how bad its corporate governance is”.
And the battle may be far from over; Leerink Swann analyst Seamus Fernandez reportedly believes it likely that Icahn will push for greater representation on the Board unless his suggested changes are put in place, reports Marketwatch.
Succession plans?
A key concern for Icahn – who owns about 10% of Forest – is the lack of disclosure regarding a succession plan for current chief executive Howard Solomon, who has headed up the company since 1977.
But his multi-pronged attack also touches on several other areas, including the assertion that the firm has ill prepared for generic erosion of sales of its key drug, the antidepressant Lexapro (escitalopram).
Commenting on Legault’s win, Icahn said: “I hope and believe that the shareholder message sent will be the first step in bringing good corporate governance to this great company – something that has been lacking for decades”.
