LONDON - The final chapter in the changeover of power at Scotia Holdings plc has been written, with founder David Horrobin resigning as nonexecutive director after failing to oust Robert Dow, who succeeded him as CEO.
Horrobin did not agree with the restructuring and revised strategy put in place by Dow, who said earlier this month he was cutting the research program from 20-plus projects to six, and focusing the company's expertise in lipids on cancer treatments.
A statement from James McKinnon, Scotia's nonexecutive chairman, said, “The board believes it is essential that all directors should support Robert Dow, who was unanimously appointed chief executive on Jan. 1, his management team and his revised strategy for Scotia.“
Horrobin persuaded Dow to join Scotia, of Sterling, Scotland, from Hoffmann-LaRoche AG, of Basel, Switzerland, appointing him medical and development director in September 1997. While Horrobin acquiesced in Dow's subsequent appointment to CEO, he did not support the new strategy.
McKinnon said, “Far from offering his support, [Horrobin] sought to convince the board that it should remove Dow from his position. In the light of the foregoing, the board requested the resignation of Horrobin.“
McKinnon also said the board endorses the changes Dow has instituted, “which are designed to bring future value to shareholders.“
Scotia's share price rose by £0.01 to £3.87 May 11, when Horrobin's departure was announced, but subsequently fell to end last week 11 percent lower, at £3.42.
When Horrobin, who owns 17 percent of Scotia, stepped down to the nonexecutive post, he agreed not to sell his holdings until next year. He also signed an agreement with the company to act as consultant and to give up this role.
Horrobin has set up a new company, called Scarista plc, which has signed exclusive licenses with Scotia to take over its programs in the area of central nervous system diseases. *