Former CalPERS Chief Appointed to ICN Board : Management: Dale Hanson is widely known as leader of shareholder rights movement. Investors pleased by news.
ICN Pharmaceuticals Inc. Tuesday took another step to repair its Wall Street image by appointing Dale Hanson, a former investment community heavyweight, to its board of directors.
Hanson, as the former chief executive of California Public Employees’ Retirement System, is widely known as a leader of the shareholder rights movement that swept corporate America in the late 1980s.
Company officials said that he’ll be both involved in company efforts to build shareholder value as well as issues involving corporate governance. Hanson, 53, said he’s joining the ICN board committee on governance and another on finance.
However, it appears ICN officials didn’t go out of their way to prepare Hanson for all the challenges he may face.
In an interview Tuesday, Hanson said that the company hadn’t informed him about a sexual harassment suit against the company’s controversial chairman, Milan Panic, and the company by a former employee.
The case, filed this year in Superior Court in Santa Ana, is scheduled for trial in March. According to a recent government filing by the company, ICN intends to vigorously defend the suit.
Hanson said he hadn’t had a chance to discuss litigation involving the company before his appointment because ICN’s legal counsel recently had been on vacation. Hanson also indicated that his own research into news stories about ICN hadn’t turned up any mention of the lawsuit.
Hanson said he talked with ICN officials before his appointment about another corporate governance issue facing ICN: Shareholder lawsuits and a federal investigation both involving Panic’s sale of $1.24 million worth of company stock last fall.
The sale occurred after the firm learned the federal Food and Drug Administration wouldn’t approve its star drug Virazole as a stand-alone treatment for the liver ailment hepatitis C. But the company didn’t disclose the FDA’s decision to investors until February, when the stock lost 42% of its value in six days of trading, falling to $13.25 a share.
Hanson said he feels “fairly comfortable” with officials’ explanation of Panic’s stock sale, a board review of the matter that exonerated Panic, and the company’s cooperation with a related Securities and Exchange Commission investigation.
*
Hanson fills a board seat formerly held by James P. Miscoll, a retired vice chairman of Bank of America, who resigned in February, according to an ICN spokesman.
Among other issues, Hanson said he’s talked with Panic in generalities about how certain companies can benefit if the chairman and chief executive positions are held by different individuals. Hanson said such a separation may be appropriate in cases where board members aren’t being fully informed of issues that should be on their agenda.
Hanson emphasized, “Clearly I need to get a little water under the bridge, so to speak, before I even look at that.”
Panic’s executive contract as ICN’s chairman, chief executive and president is up for renewal next month.
Major investors reacted favorably to Hanson’s appointment. John Nelson, an investment director at one of ICN’s major institutional investors, the State of Wisconsin’s investment board, said he suggested last March that the company retain one or two outside directors--and specifically suggested Hanson as a candidate.
“He’s not a yes-person and, from our knowledge, he’s very independent and . . . shareholder-proactive,” said Nelson.
*
Seth Glickenhaus, a partner at Glickenhaus & Co., in New York, which holds about 700,000 shares, said it’s “great” that the company was able to attract an intelligent, respectable former public official to serve on its board.
Hanson, as chief executive of CalPERS from 1987 through 1994, oversaw an investment portfolio of retirement funds for state employees that grew to $80 billion.
Last year, Hanson left CalPERS to start a San Diego investment firm, American Partners Capital Group. His partners include Republican financier Tom Stickel and lawyer Byron Georgiou, a 1992 Democratic candidate for Congress.
Though American Partners originally aimed to raise $200 million to provide “equity gap financing” for single-family homes, Hanson said it now intends to raise at least twice that to create a private stock fund investing in Latin American companies.
