VLI Board Promotes Top Officers, Rebuffs Founder

In a strong show of support for the company’s current management, the VLI Corp. board of directors Thursday elevated company President Robert Elliott to the post of board chairman and elected his hand-picked vice president of marketing, Mary George, as president and chief operating officer.

The promotions effectively rebuff the nine-month-old efforts of VLI founder and former chairman Bruce Vorhauer to replace Elliott, 47, and George, 37, with a new management team.

Vorhauer has criticized Elliott and his executive team for spending millions of dollars to promote the Irvine personal care products maker’s Today contraceptive sponge without producing an annual profit. He also has criticized the Elliot team for failing to exploit VLI’s potential as a pharmaceuticals maker.

“Basically, I’ve been excluded from the decision-making in the company,” Vorhauer said after Thursday’s announcement. Vorhauer resigned as VLI chairman last August when the board refused to support his bid to find a replacement for Elliott. Vorhauer still owns about 600,000 VLI shares, or 5.5% of the company.

The promotions came just two weeks after Vorhauer openly revealed his problems with the company by blasting the management team in comments at the annual shareholders meeting--the first public indication of his rift with Elliott, whom he personally recruited in 1983 to handle the daily operations of VLI.

Elliott has admitted to “philosophical differences” with his former mentor but has dismissed Vorhauer’s criticism as the misgivings of a company founder who has had difficulty relinquishing the reins of the company to professional managers.

The new promotions mean that Elliott will retain his position as chief executive officer and assume the chairmanship, giving up only the title and duties of president to George, who will also become the company’s first chief operating officer.

George came to VLI in 1984 with 12 years’ experience in marketing consumer products.

Lawrance A. Brown, a VLI director, said George’s promotion gives the company a line of succession and will allow Elliott to concentrate on strategic planning and new products while she assumes greater responsibility for daily operations of the company.

Vorhauer, who said he cast the only vote against the promotions at Thursday’s board meeting, charged in a brief interview that “the company has suffered from a marketing misdirection, so what do they do? They promote the people responsible for it.”