Leschly stays as SKB denies merger moves

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The Independent Online
JAN LESCHLY, the chief executive of SmithKline Beecham, yesterday strongly denied speculation that he was about to leave the pharmaceutical giant and quashed rumours of a mega-merger with Glaxo and American Home Products.

Mr Leschly used the publication of the company's third-quarter results, which beat market expectations, to dismiss reports of his impending retirement as "simply not true". He said: "I have no plans for retirement. This is just speculation."

Mr Leschly, 58, said he intended to remain at the helm of the UK's second- largest drugs group until September 2000 when he will reach 60, the company's retirement age. He added that any other decision, including a move to non-executive chairman, would have to be taken by the board.

Recent speculation that Mr Leschly would leave SKB triggered rumours that the company might reopen merger talks with Glaxo Wellcome. The planned pounds 13bn tie-up between the UK's leading drugs groups foundered in February after a clash of personalities between Mr Leschly and Sir Richard Sykes, the Glaxo chairman.

Yesterday Mr Leschly said the deal with Glaxo was "behind us. The prospects for SKB as an independent company are better than if we have a merger that is not done properly".

The SKB chief executive also ruled out reopening talks with AHP, which were abandoned earlier this year, after last week's collapse of the US group's merger with the life sciences group Monsanto.

His comments came as SKB posted a 10 per cent rise in underlying profits in the third quarter to pounds 415m, in line with its double-digit growth target. The figures sent the shares 27.5p higher to 686.5p.

SKB revealed that a possible new blockbuster, the diabetes drug Avandia, could be launched into the market in just over a year's time. SKB is to seek US regulatory approval for the treatment, which could reap annual sales of up to $1bn (pounds 590m), by the end of the year.

The company said that its laboratory near Cork, Ireland, would be expanded, creating 320 jobs in the next five years.

Investment column, page 20