Glaxo braces for City charm offensive to defend breakup plans

FTSE 100 pharmaceutical giant GlaxoSmithKline (GSK) is heading on a City charm offensive to defend its plans to split out the firm into two listed businesses.

GSK executives Sir Jonathan Symonds and Vindi Banga will try to win over City institutions at a crunch meeting on October 7, hosted by the Investor Forum.

The news was first reported by The Sunday Telegraph.

The meeting comes as relations between GSK’s board and activist investor Elliott are becoming increasingly frayed. 

Elliott is understood to be annoyed by Symonds’s, who is chairman of the pharma giant, reluctance to force GSK Dame Emma Walmsley to essentially reapply for her role.

Elliott amassed a multi-billion stake in the company in April. Walmsley is reportedly set to head the pharmaceuticals arm of the split out business. However, Elliott wants GSK to strengthen its board before the giant is spun out next year. 

GSK is coming under intensifying pressure from the activist fund, founded by Paul Singer, 77, to sell off the consumer arm, which has an estimated worth of £50bn, instead of creating a new business.

A GSK spokesperson said: “We continue to engage extensively with our shareholders with over 500 meetings so far this year. They have expressed strong support for our plans.”