Neil Woodford has won his battle with GlaxoSmithKline as chief executive Andrew Witty will leave the pharmaceutical giant next year.
GSK released a statement today saying Witty would retire on 31 March 2017, and the board will now hunt for a successor, considering internal and external candidates.
Woodford has repeatedly called for a restructuring of the GSK business, including stating that Witty was not up for the job.
Speaking in November last year, Woodford said: “You know as much as I do that running a FTSE 100 company is a very challenging business. In essence, Andrew Witty is about running four FTSE 100 companies and he’s not doing a very good job in my view.”
Witty has been with GSK for 32 years, starting as a trainee and working his way up the company.
Witty says: “By next year, I will have been chief executive for nearly 10 years and I believe this will be the right time for a new leader to take over.
“In making this decision it has been important to me that the Board have the time to conduct a full and proper process and that we sustain the momentum of our current business performance, capitalising on the very significant progress we made last year to strengthen the Group.
“By doing so we will strongly position GSK to achieve the medium-term outlook set out to investors last year and deliver a return to core earnings growth in 2016.”
Speaking last week, Woodford says he still see value in the GSK business, which is a top 10 holding in the Woodford Equity Income fund.
“Glaxo’s management team has successfully managed expectations down over the last 12 months to a level from which they can deliver positive earnings surprises.
“This hasn’t been a comfortable journey for shareholders but we continue to see substantial long-term value, believing that the sum of Glaxo’s constituent parts is significantly greater than the whole, as reflected by the current share price.”