Teva to reduce size of board after June shareholders meeting

JERUSALEM (Reuters) - Three directors are stepping down from the board at Teva Pharmaceutical Industries TEVA.TATEVA.N and only one new director is being nominated to replace them, the company said on Thursday.

A man cleans near the logo of Teva Pharmaceutical Industries at their plant in Jerusalem December 14, 2017. REUTERS/Ammar Awad

Israel-based Teva, the world’s largest generic drugmaker, is in the midst of an overhaul to deal with the $35 billion of debt it amassed after buying Allergan’s Actavis generic drug business for $40.5 billion in 2016.

Analysts and investors have criticized the company’s management and board of directors for overpaying for this deal.

Teva has since replaced most of its management and announced major job cuts. It has also reduced both the average tenure and age of its directors.

In the latest changes, Ronit Satchi-Fainaro, a Tel Aviv University professor who heads the Cancer Research and Nanomedicine Laboratory, will be the only new nominee at a June 5 shareholders meeting, the company said in a statement.

Current directors Galia Maor, Gabrielle Sulzberger and Dan Suesskind will not submit their candidacy for reelection. This will leave the board with 11 members, down from the current 13.

Suesskind, a former chief financial officer of Teva, was brought in last year as the company grappled with a financial crisis. Maor, a former CEO of Bank Leumi, has served since 2012.

Sulzberger, who has served since 2015, is a general partner of the Rustic Canyon/Fontis Partners investment fund.

“We continue to evaluate the size and composition of our board of directors to ensure it maintains dynamic, exceptionally qualified members and that the mix of talent and experience on the board reflects all the challenges that the company faces,” the company said in an emailed statement to Reuters.

At the June meeting shareholders will also vote on a proposal to give them more say in determining compensation for Teva executives.

Teva has repaid over $2 billion of its debt this year, mostly from the proceeds of the sale of its women’s health business. In March, it completed a $4.5 billion bond offering, which was used to repay existing loans.

Reporting by Ari Rabinovitch and Tova Cohen. Editing by Jane Merriman