Elan rejects investor's claims and 'misinformation'
Published 08/09/2010 | 05:00
Irish drug company Elan has lashed out at Denmark-based activist investor and shareholder Ib Sonderby, alleging his claims against the firm and its board members are misleading and false.
Mr Sonderby will today unveil four candidates for the Elan board, in what he says is an effort to address serious corporate governance and strategy issues at the group. It's believed he wants to see the replacement of current Elan chief financial officer Shane Cooke.
The move will pile pressure on Elan, which on Monday rushed to secure a High Court injunction against two US-based non-executive directors it labelled dissidents. Jack Schuler and Vaughn Bryson, both industry veterans, had launched their own investigation into a number of issues at Elan and were purporting to do so with a mandate from the company.
Elan, which is undertaking its own independent review of corporate governance issues, claimed the parallel investigation hadn't been authorised by the board and could "hijack" the independent review.
In a letter to shareholders yesterday, Elan chief executive Kelly Martin sought to defend the company's recent track record and said that Mr Sonderby had personally attacked executive management and has "continued to deliberately spread misinformation and recycle issues that have been previously addressed".
In recent weeks, Mr Sonderby has raised issues related to the disposal of Elan's Prialt drug to Azur Pharma, a company founded by a former Elan director.
Speaking to the Irish Independent, Mr Sonderby said that he will press ahead today with plans to reveal his four candidates, all of whom he said are industry experts. He denied they had little chance of making it onto the board and said he hoped they would be appointed "very soon".
"I'm not sending four people to represent me, but who will add value for shareholders," he said, adding that he was astounded at Monday's events in the High Court and also that Elan had been undertaking a corporate governance review since May but had not informed shareholders.
Mr Sonderby denied Mr Martin's claim that he had refused repeated offers to meet management, saying that he has attempted to contact the board on numerous occasions and only ever received one reply.
Mr Martin, a former Merrill Lynch banker, is planning to step down from his role in 2012, while chairman Kyran McLaughlin, who's also deputy chairman of Davy Stockbrokers, is also retiring from the board.