Elan’s ‘dissident’ directors to quit

THE two “dissident” directors at the heart of the recent boardroom dispute at Irish pharmaceutical firm Elan are to leave their posts — resolving the row.

High-profile independent shareholder Ib Sonderby has been heading an investor campaign aimed at transforming the Elan board and recently proposed four non-executive candidates.

Last week, Elan said it welcomed all shareholder feedback and would forward such pleas to its nominations and audit committee. While nothing more on that issue has come to light, an apparently totally separate issue arose with existing non-executive directors — Vaughn Bryson and Jack Schuler — saying they intended to establish an independent inquiry in to alleged corporate governance issues at Elan. This led the company’s management branding the two men as “dissident” directors.

Yesterday, Elan, which is chiefly known for its co-ownership of the multiple sclerosis treatment Tysabri, said its board was unanimously accepting a report prepared by American law firm McKenna Long & Aldridge which found in an independent review that no instances of legal breaches or other wrongdoing by the company’s management, advisers or board of directors.

Messrs Schuler and Bryson have also expressed their satisfaction with the review and have dropped their threat of High Court proceedings against the company.

In addition, the two directors have stated their intention to resign from the board. They will formally do so within the next 90 days, whether or not that ties in with Elan finding a new chairman to succeed the outgoing Kyran McLaughlin.

“The resolution to this matter will allow management to focus on the longer-term strategic management of the business,” noted Ian Hunter of Goodbody Stockbrokers.

In a brief statement, Elan said the resolution of the issue would allow it to “bring a renewed focus” to its scientific mission.

Yesterday’s news did nothing for Elan’s share price, which fluctuated through most of the day, finally closing at €3.71 — down by 4c (nearly 1.2%) on Thursday’s close.