Farallon Capital Might Undertake Proxy Fight Against Exelixis, Nominates Three Directors

Farallon Capital Management is planning to start a proxy battle at Exelixis Inc EXEL and has nominated three director candidates, it signaled in an SEC filing.
The firm hadn’t decided to move forward with a proxy fight, Wall Street Journal reported and was still trying to work with the company. According to proxy materials, the window to nominate directors ran from February 24 to March 26.
Farallon’s three nominees are Tom Heyman, formerly of Johnson & Johnson JNJ; Dave Johnson, a managing partner at Caligan Partners LP; and Bob Oliver, the former CEO of Otsuka America Pharmaceutical Inc.
Hedge fund Farallon has a roughly 7.2% stake in cancer-focused Exelixis. It has been an investor in the business since 2018.
Farallon wants the board to communicate a plan to deliver cash flows from its flagship product, cabozantinib.
It estimates that the value of cabozantinib’s cash flow is more than $33 per share alone.
Also Read: Roche, Exelixis Report Second Flop Out Of Three Trials Evaluating Cabozantinib/Atezolizumab Combo.
Farallon has been in talks with Exelixis over how it spends its R&D budget, which is expected to top $1 billion in 2023, but the discussions recently fell apart, the report added.
Farallon says that Exelixis has failed to translate its library of cancer treatments into value for shareholders, delivering returns of less than 1% annually in the more than two decades since its initial public offering, the report added, citing people familiar with the matter.
Price Action: EXEL shares closed at $19.88 on Tuesday.

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