Ariad Pharmaceuticals (ARIA) Stock Climbs | CEO To Retire

Ariad Pharmaceuticals Stock News ARIAAriad Pharmaceuticals, Inc. (NASDAQ: ARIA)

Ariad Pharmaceuticals stock is up today on high volume. However, it’s not unfounded growth as there’s a reason for all the madness. Today, ARIA’s CEO announced that he would retire as part of a settlement. So, we’ll talk about who pushed the CEO out of the chair, who will be replacing him, how the markets reacted to the news, and what we can expect to see moving forward. So, let’s get right to it…

Why Is Ariad Pharmaceutical’s CEO Retiring?

The retirement of Ariad’s CEO, Harvey Berger is the result of a settlement between Mr. Berger and an activist hedge fund known as Sarissa Capital. The battle between the two has been going on for months and led to questions revolving around the growth potential of the cancer drug maker.

Sarissa, Ariad Pharmaceutical’s largest share holder announced that Harvey Berger will be stepping down as CEO as soon as a replacement CEO is appointed; which will be no later than December 31st.

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How The Stock Reacted To The News

In most cases, investors are relatively concerned when a CEO announces retirement. However, in the case of Ariad Pharmaceuticals, that doesn’t seem to be how it’s going at all. As a matter of fact, ARIA is climbing today on high volume. After an early morning spike, we saw a bit of a correction followed by more growth. Currently (1:09), ARIA is trading at $9.12 per share after a gain of 2.82% so far today.

What We Can Expect Moving Forward

Because Sarissa yields such power over Ariad Pharmaceuticals, this will prove to be a good thing in the long run. The reality is that as ARIA’s biggest investor, Sarissa should be happy with the conduct and movement of the company. In previous statements, they’ve proven not to be happy with the following comments, just to name a few…

extremely concerned with the conduct of certain members”

particularly with respect to compensation, governance and financial matters”

breaches of their fiduciary duties”

The reality is that Sarissa had reason to be upset. Overcompensation of major players in the company can hinder growth and lead investors to believe that those running the company don’t care as much. All in all, something needed to be done and it has been. So, we can expect to continue to see growth moving forward as ARIA’s fundamentals continue to improve.

What Do You Think?

Where do you think ARIA is headed and why? Let us know in the comments below!

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