Forest CEO Solomon Finally Listens To Carl Icahn And Will Retire

Carl Icahn has been waiting a long time for this. After years of controversy over his stewardship, Howard Solomon will retire as ceo of Forest Laboratories by the end of the year, and he will relinquish his role as chairman by the time the drugmaker holds its annual meeting in 2014. Meanwhile, a committee has been appointed to choose a successor. He will, however, remain a director. The move comes after Solomon, who is 85 and has been ceo since 1977, has had a decidedly mixed tenure. On one hand, he helped build the drugmaker into a large purveyor of medicines, but more recently, he presided over setbacks that prompted corporate raider Carl Icahn to attack his leadership and successfully place a representative on the Forest board after accumulating 9 percent of the stock. A key question now is whether this change will prompt Icahn to move for a sale of the drugmaker. "We think he is likely to do so as the current interest rate environment may not persist until the next window of opportunity, two to three years after the next ceo takes office," writes Sanford Bernstein analyst Ronny Gal in a research note. "There is an open question whether Icahn will actually succeed in pushing this agenda, likely depending on whether Solomon supports the idea, which is a possibility given that he owns a lot of shares. At any rate, we expect the question will likely be raised." The backdrop for Icahn's actions began three years ago, when Forest pleaded guilty to obstruction of justice, distr...
Source: Pharmalot - Category: Pharma Commentators Authors: Source Type: blogs