Glaxo shares soar on renewed merger hopes

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The Independent Online

The mere suggestion that Sir Richard Sykes might consider becoming rector of Imperial College, London University, was enough to add £2bn yesterday to the stock market value of Glaxo Wellcome, the pharmaceuticals group Sir Richard chairs.

The mere suggestion that Sir Richard Sykes might consider becoming rector of Imperial College, London University, was enough to add £2bn yesterday to the stock market value of Glaxo Wellcome, the pharmaceuticals group Sir Richard chairs.

Glaxo shares leapt 56p to £17.66 on hopes that Sir Richard's departure might revive the group's oft-speculated merger with SmithKline Beecham. They later subsided to end the day at £17.50 on thin trading of only 1.2 million shares. SKB rose 4p to 790p.

Imperial is one of Britain's most prestigious scientific academic bodies, and Sir Richard is a known propagandist for a greater emphasis on science in education. But the rectorship falls vacant in March 2001, while Sir Richard is not due to retire from Glaxo until he reaches the age of 60 in August 2002.

"Sir Richard has no plans to join Imperial College or any other institution," said a Glaxo spokesman. "His prime focus remains fully on the business of Glaxo. It would be surprising if there weren't interest from academia in what he was going to do come his retirement."

Nevertheless, observers pointed out that if Imperial were sufficiently keen to capture Sir Richard they might be willing to let him serve part-time until he retired from Glaxo.

Merger talks between Glaxo and SKB broke down in 1998 when Sir Richard demanded he run the merged group. But the recent hostile bid for Warner-Lambert by Pfizer has added to pressure for a deal in what has become a global race for size.

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