Vivus Says Dissidents Reject Offer Including CEO Leaving

Vivus Inc. (VVUS), the drugmaker battling its largest shareholder for control of the company, said the dissident investor rejected a settlement offer that included four of nine board seats and the chief executive officer’s retirement.

Vivus proposed equal representation on its board to First Manhattan Co., with each side getting four seats and an independent investor representative getting the ninth, the Mountain View, California-based company said today in a statement. Leland Wilson offered to resign from the board and retire as CEO when the company hired a successor.

The proposal is at least the second that Vivus, which makes the obesity drug Qsymia, has offered First Manhattan; on July 13, Vivus said it invited three dissident nominees to join the board in an attempt to reach a compromise. The next day, Vivus said it delayed its annual meeting by three days, to July 18.

Yesterday, First Manhattan, which owns 9.9 percent of Vivus’s outstanding shares, sued the company and claimed it had enough votes on the eve of the meeting to win the proxy fight.

“It is our desire to end this closely contested proxy battle without handing the company over to Mr. Colin ahead of the vote,” Wilson said in the statement today, referring to Sam Colin, senior managing director at First Manhattan. “We believe our proposal, which included my stepping down as CEO of Vivus, was extremely fair and balanced.”

To contact the reporter on this story: Meg Tirrell in New York at mtirrell@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

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