This was the deal that caught everyone on the hop. There’ll
probably be many fireside reminiscences in years to come along the lines
of the ’where were you when Glaxo Wellcome said they’d merge with
SmithKline Beecham?’ variety. The answer being for most of the City: ’in
a wine bar’, I expect.
According to the Financial Times, the announcement was put out at
11.15pm on Friday. Where fighting for column inches is the name of the
game, then this would obviously be sub-optimal timing. But there never
would be any shortage of newsprint over such a sensational turn of
events, so the timing probably didn’t really matter.
Coverage has been largely positive, mainly, I think because the
background to these kinds of deals has been largely signalled in the
past. The fact that big pharmaceutical companies seem unable on their
own to come up with new products to produce a growth rate acceptable to
shareholders is a theme that has been around since the mega-mergers in
the industry first began. Therefore the informed reader has a pretty
good idea of the reasoning behind the deals and has bought into the
Secondly, the strategies, products, markets and management of both
companies have also been widely reported in the quality press - in fact
you could say that both of them are seldom out of the news.
Both companies have vigorous leaders and both have a significant
commitment to the highest possible standards of professionalism in their
investor and media relations. This is a continual effort which reaps
dividends in these circumstances in terms of high familiarity and
My conclusion is that the financial audience has been well handled. The
area which one could say has been neglected is the employee audience -
although one does not know the detail of any employee communications
programme undertake internally. However it cannot do much for morale to
read in the press that 10 per cent of the combined workforce, that is
about 11,000 people, stand to lose their jobs.
However, having been in these situations myself as an in-house PR, I
know just how impossible it is to balance City requirements with the
needs of employees in these circumstances. All things considered, my
verdict would be well done to both companies.