Lilly Wants to Double Shares, Just In Case Takeover Bid Arises
February 5, 1998
Dow Jones Newswires
Eli Lilly & Co. asked shareholders to approve an
increase in the authorized number of its common shares
to 3.2 billion from 1.6 billion, according to a filing
Thursday with the Securities and Exchange Commission.
The company said it has no immediate plans for the
common stock. However, it could use the additional
shares to try to avert a hostile takeover effort by
countering the bid or by selling them to dilute the
bidder's voting power, the filing said.
The board of Eli Lilly doesn't know of any effort to gain
control of the company or accumulate its shares,
according to the filing. However, merger discussions
between SmithKline Beecham PLC and Glaxo
Wellcome PLC have sparked speculation that a new
wave of consolidation would move through the
pharmaceutical industry.
Eli Lilly is considered a likely takeover candidate in any
industry consolidation because it is one of the smaller of
the major drug makers, industry watchers have said.
In the filing, the company's board said it is seeking the
increase in authorized shares in part because a 2-for-1
stock split last October significantly reduced shares on
hand. Companies often seek an increase in the number
of authorized shares to gain increased flexibility in
completing such transactions as stock splits.
Also in the filing, the company reported Chairman and
Chief Executive Randall Tobias earned $2.7 million in
salary, bonus and other annual compensation last year,
up nearly 13% from the $2.4 million he earned in 1996.
Mr. Tobias also received options to purchase 225,000
shares at $64.06 a share valued at $3.5 million,
according to the filing. In all, Mr. Tobias has exercisable
options to purchase 1.2 million shares valued at $68.5
million and unexercisable options to buy 1.125 million
shares valued at about $39.8 million, the filing said.
Sidney Taurel, Lilly's president and chief operating
officer, saw his salary, bonus and other annual
compensation rise nearly 12% to $1.67 million from
$1.49 million. He received options to purchase 125,000
shares at $64.06 a share valued at nearly $1.95 million,
according to the filing.
In all, Mr. Taurel has exercisable options to purchase
788,800 shares valued at $43.6 million and
unexercisable options to buy 575,000 shares valued at
nearly $20 million, according to the filing. |
