Glaxosmithkline boss Emma Walmsley fights back in showdown with feared US activist Elliott Management
Glaxosmithkline boss Emma Walmsley has launched a fight back amid claims she could be ousted by activist investors.
The 51-year-old was forced onto the defensive after feared Wall Street fund Elliott Management took a ‘multi-billion-pound’ stake.
She said ‘enormous’ progress had been made in the drug maker’s turnaround and rejected suggestions she should change direction.
Pressure: Glaxosmithkline boss Emma Walmsley was forced onto the defensive after feared Wall Street fund Elliott Management took a ‘multi-billion-pound’ stake
She insisted she was the right person to lead Glaxo after it spins off its consumer arm next year.
Her comments came as the firm reported its first-quarter results just days after Elliott, whose co-chief executive is Paul Singer, which is notorious for its aggressive tactics, emerged as a major shareholder.
That has put Walmsley’s broader strategy as chief executive under the microscope. Analysts believe Elliott could push for cuts to research spending, a speedier separation of the consumer arm, a spin-off of the vaccines division or even her removal.
It was claimed by one top 20 shareholder that Walmsley, whose background is in consumer businesses, has ruffled feathers by opting to lead the remaining pharmaceuticals and vaccine company when the consumer arm is broken off.
But she hit back, saying: ‘I am not a scientist. I am a business leader. I believe the priorities as the chief executive are to set the strategy and I have clearly laid out from day one our priority there.
‘We have thousands and thousands of highly talented, dedicated scientists in this company who get up in the morning to beat disease and to progress our pipeline.
‘The chief executive should be held accountable for results. We have made an enormous amount of change in this super-tanker of a company in recent years. There is definitely more to be made.’
Threat: Elliott Management, whose co-chief executive is Paul Singer (pictured), is notorious for its aggressive tactics
She added: ‘I am very focused on delivering on the broader transformation of GSK… through that successful separation and beyond.’
The mother-of-four took over from former boss Sir Andrew Witty in 2017, and has poached star executives from rivals and culled managers.
But Walmsley’s biggest gambles have been the £4billion takeover of US cancer drugs specialist Tesaro in 2018 and the proposed separation of the consumer business, expected in mid-2022.
Yesterday, she rejected suggestions that research spending could be cut or that the vaccines business could be separated from pharma, saying both were key to the future’.
She is due to set out further details of the break-up in June.
Revenues fell 18 per cent to £7.4billion in the first three months of 2021 – below analyst predictions of £7.8billion. Profits shrank by 17 per cent to £1.5billion.
Though it is the world’s largest vaccine maker, it has not developed a Covid-19 vaccine.
As a result of governments prioritising Covid-19 and putting other vaccination pushes on hold, the vaccines division’s business dropped nearly by a third.
But Walmsley said she expected sales to recover as pandemic restrictions lift and people begin to visit the doctor and hospitals again for routine check-ups.