"The current directors are not being replaced fast enough," said Landa. "We'll have to wait another year for the injection of new blood into the board, and that's not good. There is no problem with a board of 12-13 directors, that's normal, but there should be a faster turnover. We shouldn't have to wait years. A responsible director would get up and say, "I am vacating my position for the good of the company."
Landa, who reportedly owns several tens of millions of dollars worth of Teva shares, is the person who ignited yesterday's announcement. Several months ago, dissatisfied with Teva's corporate governance in view of the ouster of former CEO Dr.
On Wednesday, Teva announced that chairman Dr.
Landa says that when a director is elected for a three-year term, he cannot be forced out before then. "Without amending the articles of incorporation, they cannot be replaced. That's bad, because if a director is not functioning, you need a 85% supermajority of shareholders to replace him," he says. "I expect caring and Zionist Israeli directors to stand up and say, 'I am voluntarily leaving. The company needs someone else'."
"Globes": What are the chances of that happening?
Landa: "It won't happen for a lot of reasons. Among other things, Teva's directors receive huge financial compensation, as well as having the honor that goes with being part of what may be the most prestigious board of directors in
The appointment of Halfon, who has experience at
Who do you think should succeed Frost as chairman? Is vice chairman
"I don't wish to personally mention this or any other appointment. The company needs a chairman of stature from the global pharmaceutical industry. I fear that Teva won't find, or even look for, a chairman of global stature. The last thing that it should do is to appoint 'one of our own', a current director who did not come from the pharmaceutical industry. That would be a step backwards."
Why do you fear that Teva won't look for such a chairman?
"Because it did not announce a change in the articles of incorporation, which is another disappointment for me. This is very flawed corporate governance, because it's absurd that an 85% majority is needed to replace a director. Only a third of the directors are replaced each year, so many years are needed to make substantial change. It isn't to protect the company from a takeover, but for the directors to dig in, to protect them from their shareholders. It's wrong and unacceptable. It's simply a bunker-like articles of incorporation. That is why there is concern that, like the protective articles of incorporation, the directors are looking out for each other, raising concern that they will appoint a new chairman from the current board."
Despite Landa's considerable criticism, he emphasizes that the current steps announced yesterday are important. "I don't want to denigrate the steps taken. I am very pleased," he says, "but it's not enough and not fast enough."
Do you feel personal satisfaction that you caused these changes as a minority shareholder?
"There is satisfaction, but it's very limited. Teva is
What will be your next step as an activist?
"Wait and see."
(c)2014 the Globes (Tel Aviv, Israel)
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