President Donald Trump (L) listens as Pfizer Chairman and CEO Ian Reed announces a new pharmaceutical glass packaging initiative in the Roosevelt Room of the White House on July 20, 2017 in Washington, DC.
Andrew Haller | Bloomberg | Getty Images
previous Pfizer Chief Executive Ian Read and former Chief Financial Officer Frank D’Amelio said late Wednesday they were exiting Starboard Value’s campaign at the embattled pharmaceutical giant, just days after News of the activist’s stake came days after news broke.
In a joint statement issued through their investment banks, Reid and D’Amelio said they “fully support” Pfizer CEO Albert Bourla and confirmed that the statement was true. People familiar with the matter said the two had been in contact with several directors shortly before news of Starboard’s stake broke on Sunday night.
“We believe they will deliver value to shareholders over time,” two former executives said of Pfizer’s current board and management. The company’s shares are essentially flat this year and are down about 50% from their 2021 highs.
The statement was made through Guggenheim Securities, which has long advised Pfizer on the deal. A representative for the bank declined to comment on the release.
The turn of events comes as Pfizer’s board grapples with the activist’s efforts, people familiar with the situation said, and comes just days after Starboard’s Jeff Smith was scheduled to meet with CEO Bourla . It would be highly unusual for someone high up to join and then withdraw from an activist campaign.
It’s unclear what impact, if any, the breakup will have on Starboard’s campaign. Representatives for the activist fund did not immediately respond to a request for comment. Starboard, one of the largest and most tenacious activist funds, has accumulated about $1 billion in positions in the pharmaceutical company, according to previous reports by CNBC.
Jeff Smith is a managing member of Starboard and previously worked at Autodesk and salesperson recent months. While it generally focuses on the technology sector, it also holds shares Starbucks and parent company of The Wall Street Journal News Corp This year.
A Pfizer representative did not respond to a request for comment.
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