Elliott Takes Big Stake in Drugmaker Catalent

Activist shareholder Elliott Investment Management has built a significant stake in Catalent and is pushing for a shake-up on the contract drugmaker’s board.

Elliott has been talking to potential director candidates about joining a slate of nominees to run in a proxy contest, people familiar with the matter said.

The exact size of Elliott’s stake couldn’t be learned. Catalent has a market capitalization of roughly $8.4 billion, with its stock up just 3% so far this year. The shares closed Wednesday at $46.32, less than half where they traded a year ago.

Catalent’s nomination window for director candidates closes on July 29, according to the company’s proxy materials.

Elliott’s stake and push for change comes at a tumultuous time for Catalent, which provides outsourced drug manufacturing for pharmaceutical and biotech companies. The Somerset, N.J., company played a critical role in the rapid mass production of vaccines during the Covid-19 pandemic and has more recently been seen as a possible takeover target.

In recent months, however, Catalent has faced significant setbacks including the departure of its chief financial officer in April.

The company also announced that greater-than-expected costs along with many operational snafus at some of its manufacturing sites—some of which were tied to failed Food and Drug Administration facility inspections—would weigh heavily on its results.

After several delayed results announcements, the company said in June that revenue for the three-month period ended March 31 fell 19% to $1.04 billion. It booked a net loss of $227 million, compared with net earnings of $141 million in the same period a year earlier.

Catalent Chief Executive Officer Alessandro Maselli,

Last month, Catalent named a new CFO, Matti Masanovich, who had previously been the finance chief of Tenneco Automotive until it was acquired by private-equity firm Apollo.

Elliott is known for taking on tech companies and others and forcing changes that include sales and executive shake-ups. One of the biggest, busiest and most feared activists, it has taken on companies including NRG Energy, Salesforce, Twitter and Pinterest.

On Tuesday, Constellation Brands announced an agreement with Elliott by which the Corona beer parent will appoint two new independent directors to its board and privately share more information with the activist about its business. 

Earlier in the year, a number of high-profile proxy contests ended in truces, including at

The number of proxy fights in the U.S. dropped by roughly 20% during a period from Sept. 1 through June 16, while brokered settlements between companies and activists rose by about the same percentage, according to an analysis by law firm Kirkland & Ellis. 

Write to Lauren Thomas at [email protected]