Glaxo 'may seek partners'

THE CHAIRMAN of Glaxo Wellcome yesterday said that hostile bids for major pharmaceutical companies were "almost impossible" because of the high stock market valuations across the industry. But Sir Richard Sykes did not rule out seeking another merger partner after the collapse of talks with SmithKline Beecham and believes that the industry will continue to consolidate

In his first public comments since the end of the pounds 100bn merger talks which could have created the biggest drugs group in the world, Sir Richard told the House of Commons Science and Technology Committee that Glaxo would consider seeking other partners if it would enhance the research and development of new drugs.

He said the talks broke due to differing cultures and management styles. "A dispute about the vision of the future led to a breakdown in discussions. When asked how such a large merger could have been aborted over the "pecking order of five directors", Sir Richard said that morale in the new company would have been affected if there was not harmony in the boardroom.

Although he was guarded in giving reasons for the collapse of the talks, Sir Richard said there was no legal impediment to their re-opening.

Sir Richard also denied Glaxo shareholders were in open revolt over the collapse of the talks, which wiped around pounds 14bn off the value of both groups.