Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

GlaxoSmithKline names insider Emma Walmsley as new CEO

Stock Markets Sep 20, 2016 06:11AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Emma Walmsley of GlaxoSmithKline poses in this undated photohgraph released in London
 
UK100
+1.04%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Ben Hirschler

LONDON (Reuters) - GlaxoSmithKline said on Tuesday it had chosen its head of consumer healthcare, Emma Walmsley, as its new chief executive, after several months reviewing internal and external candidates.

She will become the first woman to head a top global pharmaceutical company and will bring the number of female chief executives in Britain's FTSE 100 index to seven.

Walmsley, 47, joined Britain's biggest drugmaker in 2010 from L’Oreal and will replace Andrew Witty, who had previously announced his decision to retire on March 31, 2017. She will join the board from January.

The decision will disappoint investors such as Neil Woodford, a top shareholder and a critic of the drugmaker's current structure, who wanted to see an outsider appointed to overhaul the company.

However, Walmsley had always been tipped as a strong internal candidate, along with pharmaceuticals boss Abbas Hussain and manufacturing head Roger Connor.

Her appointment is likely to be seen as a signal that GSK will retain the consumer business as a core part of its operations, rather than splitting up the company.

"Choosing Emma Walmsley suggests a strategy of evolution rather than revolution," Joe Walters, senior portfolio manager at Royal London Asset Management, one of GSK’s 30 largest investors, told Reuters.

"A big change in the firm’s corporate structure is less likely, but any worries about a reduction in Glaxo’s attractive dividend payments should recede."

GSK's 5 percent yield is a big lure for investors. A weaker pound after Britain's vote to leave the European Union helped the group's 2016 outlook and also soothed fears of a dividend cut, but there had been speculation that an outside CEO might go on a major buying spree that could crimp payouts.

Chairman Philip Hampton said in a statement that GSK had market-leading positions in pharmaceuticals, vaccines and consumer healthcare that provided excellent platforms for sustainable, long-term growth.

Shares in GSK slipped 0.5 percent by 0940 GMT.

BROAD PORTFOLIO

At the helm since 2008, Witty has struggled with flagging sales and profits, as well as a damaging corruption scandal in China, although earnings are now improving.

Some investors and analysts have questioned his focus on a consumer health business that ranges from headache pills to toothpaste. Other drugmakers have enjoyed better share price performance in recent years by riding a wave of innovation in disease areas such as cancer.

GSK has chosen to largely sit out a wave of acquisitions in the pharmaceuticals industry that has seen rivals spending billions of dollars on promising experimental medicines.

A $20 billion asset swap with Novartis, completed last year, which involved the exchange of cancer drugs for the Swiss group’s consumer health products and vaccines, was a centerpiece of Witty's time in charge.

The deal crystallized the company's idea of reducing exposure to premium-priced pharmaceuticals and increasing sales of over-the-counter products, as well as selling more lower-priced medicines in emerging markets.

Walmsley has been intimately involved in that strategy as head of consumer healthcare and, like Hampton, she sees the breadth of GSK's portfolio as a key strength.

"We have momentum in the group and as the demand for medical innovation and trusted healthcare products continues to rise, we have the opportunity and the potential to create meaningful benefits for patients, consumers and our shareholders," she said in the statement.

As head of GSK's consumer healthcare operations, Walmsley is responsible for a business with 21,000 employees and annual sales of 6 billion pounds ($7.8 billion), equal to around a quarter of group sales.

GlaxoSmithKline names insider Emma Walmsley as new CEO
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email