Ironwood $IRWD is ramping its efforts to fend off a board activist known for auctioning biotechs to the highest bidder, sending out a plea to shareholders Wednesday to reject Alex Denner’s bid for a board seat.
At first, Ironwood appeared open to the idea, notifying shareholders last month that Sarissa Capital, Denner’s company, planned to nominate him. Sarissa took a stake in Ironwood late last year. Denner is probably best known as Carl Icahn’s protégé, with a history of spurring acquisitions of the companies in which he invests. He served as chairman of Ariad before Takeda acquired the cancer company for $5.2 billion last year. He was also a board member at Bioverativ before it was sold to Sanofi for $11.6 billion earlier this year. And he recently took control of The Medicines Co $MDCO amid considerable buzz.
Now with his eye on Ironwood, the company’s stock price has climbed at the thought of higher shareholder value. But after three meetings with Denner to better understand his intentions for the company, Ironwood’s executives decided they weren’t thrilled with the prospect of him on their board.
“Ironwood strongly believes that Sarissa has not made a compelling case for Ironwood to add Alex Denner to the board, given the skills, experience and diversity of the existing directors who have acted to unlock value for Ironwood shareholders,” Ironwood stated in new press release Wednesday.
Instead, Ironwood is urging shareholders to vote for three independent directors who are up for re-election. The move comes a week after Ironwood announced it would split into two public-traded companies: one focused on the company’s FDA-approved gastrointestinal drugs, and the other on developing treatments for rare disorders and other serious conditions. The idea might be an effort to show investors that Ironwood can be profitable without Denner’s influence.
Ironwood’s next annual meeting of shareholders, in which the vote will take place, is scheduled for May 31.
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