Icahn Tries End-around in Proxy Fight with Forest Labs CEO/Chairman
Activist investor Carl Icahn has sent a letter to the non-executive members of the board of directors of Forest Laboratories Inc. (NYSE: FRX) asking them avoid a protracted proxy fight over his request to add two directors. Icahn owns nearly 10% of Forest Labs’ stock.
In an earlier letter to Forest CEO and chairman Howard Solomon, Icahn questioned the company’s succession plan for the 84-year old Solomon and suggested that Solomon may be planning to create a “dynasty” by promoting his son as the company’s next CEO. Solomon denied the allegation.
According to The Wall Street Journal, Icahn’s letter to the non-executive members of Forest’s board noted that his pleas for information from Solomon “have fallen on deaf ears” and that Icahn is “concerned we are reaching a precipice in this proxy contest from which an amicable solution is no longer possible.”
Icahn also noted in his letter that the imminent patent expirations on key drugs pose a serious problem for the company and that he does not believe that the current drug pipeline “will be sufficient to pick up the slack.”
Shares of Forest Labs are down about -0.9% in early trading this morning, at $35.01 in a 52-week range of $28.47-$39.35.