This time, Carl Icahn may have chosen a biopharma adversary as stubborn as himself. And that's saying something. Forest Laboratories ($FRX) CEO Howard Solomon shows no sign of backing down in his defense of the company's current regime. And he's perfectly willing to fight eye-to-eye with the activist investor. No shying away from a public argument here.
In fact, as Reuters reports, Icahn offered to compromise with Forest. Before launching his second proxy fight for four seats on the drugmaker's board, he offered to accept two seats on an enlarged board instead. It's a strategy that worked before with other drugmakers; Biogen Idec ($BIIB), for instance, gave Icahn one board seat to get his backing for two of its own nominees.
Solomon and his team would have none of it. The 84-year-old CEO disputes Icahn's criticisms--including charges that he's mismanaging Forest's response to the Lexapro patent expiration--and his board is backing him up. "[Solomon] just said, 'The board doesn't want you on.' And that was the end of it," Icahn told Reuters.
Instead, Solomon chose to go the distance. Not without reason; Forest shareholders nixed all of Icahn's nominees last year. And now that Icahn has started poking at Solomon's son David, the Forest chief has personal motivation.
Icahn took aim at the company's succession plan--or alleged lack thereof--suggesting that Solomon wanted his son to take the job. Now, Forest has hired an executive search firm to help. But that's as far as Solomon's sympathy goes. Want to critique my son's resume? What about your son's?
"I did not anticipate that my son David would be publicly disparaged and caricatured by someone utterly ignorant of even the slightest information about his qualifications or performance," Solomon wrote, going on to remind Icahn that he himself has appointed his son to the boards of public companies. "The qualifications of our sons should speak for themselves," Solomon added. And for the record, he said, David Solomon will be "neither favored nor handicapped" for promotion at the company "because of his relationship with me."
- read the letter from Solomon
- see the Reuters news
- get more, also from Reuters
- check out the Wall Street Journal story
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