French drugmaker Sanofi, one of the country’s largest companies, fired its chief executive on Wednesday after a row over his management style, sending the pharmaceutical giant’s shares sharply lower.
Sanofi stock dropped more than 5 percent on the opening bell of the Paris stock market after losing more than 10 percent the day before over disappointing earnings.
Shares rallied briefly during the day, but still closed down more than 4.5 percent lower, weighing down the overall Paris market, which was flat at the close.
The 54-year-old Christopher Viehbacher, who holds dual Canadian and German nationality, had been chief executive since December 2008, but had recently become embroiled in a boardroom row.
He piloted the group through a period when it lost its exclusive rights to several important drugs and refocused the business on activities with strong potential, and notably the acquisition of US biotechnology group Genzyme.
A matter-of-fact company statement hinted at boardroom battles.
The firm needs a manager committed to “focusing on execution with a close and confident cooperation with the board,” Sanofi said.
The firm appointed chairman Serge Weinberg as a temporary replacement.
Weinberg told reporters the decision to sack Viehbacher was taken “unanimously” due to the chief executive’s “management style,” but denied that it was a personal issue.
Viehbacher had come under fire for choosing to base himself in Boston to run the group.
Media reports suggested the board was concerned the group’s core activities were shifting away from France toward the US.
Weinberg said this “was not the reason” for his ousting and also denied Viehbacher’s nationality had anything to do with the decision, saying it was “completely non-sensical” to suggest there was a problem with a foreigner running a top French company.
“Nationality was not a factor,” Weinberg said.
In his six years at the helm of the pharmaceutical giant, Viehbacher embarked on a severe cost-cutting drive and in September 2012, launched a plan to slash 900 jobs by the end of next year, putting him on a collision course with unions.
Weinberg said Viehbacher’s departure did not herald a “change in strategy” for the group, saying that the firm’s direction had been set before Viehbacher even arrived at Sanofi.
The new chief executive also said there was “no particular concern” about the group’s finances.
On Tuesday, the group said that net profits had slipped in the third quarter, but that its main treatments were doing well and research for new drugs, including a dengue fever vaccine looked promising.
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