Activist Investor Benny Landa : Why I Care about Teva


Eight weeks later, on October 29th, 2013, I called Jeremy Levin, Teva’s CEO, to tell him how pleased I was to read in the newspaper that there was no truth to the rumor that he is considering resigning from Teva. His response was “That doesn’t matter, I think the Board is about to fire me anyhow”. Concerned, I sent a quick message to several Teva directors whom I knew personally,   beseeching the Board not to take such action, which could hurt Teva and certainly not be in the interests of its shareholders. To no avail. The following day, Levin’s “resignation” was announced.

I was deeply disturbed by this. Not because the Board decided to fire Levin – but by the way it was done. Hiring and firing CEO’s is the Board’s prerogative. But it must do so responsibly. Of course under some circumstances firing a CEO from one minute to the next, without warning, without preparation of any kind, may be justified. Indeed, a CEO who is discovered to be corrupt, who has committed fraud, sexual harassment or has been charged with a serious crime must face summary dismissal. But what was Jeremy Levin’s crime? In the words of Chairman Frost, there were “slight differences over nuances”!That’s itNuances? What responsible board fires a CEO without preparing in advance, without conducting a search for a successor, without a transition plan – for “nuances”? How can nuances become an emergency, warranting such an urgent and extreme measure? One can’t help but feel that the Board’s action was unplanned and capricious.

Moreover, even if the board had good reason to replace Levin, why do so in such a humiliating manner? Beyond being CEO of Teva, Levin was an accomplished global pharmaceutical executive, highly respected in the industry and by Wall Street. The damage to Teva of the Board’s action went beyond the immediate 10% decline in shareholder value. It was a blow to the stature of Teva and of the Board, which appeared more concerned with boardroom intrigues than with responsible governance.

Moreover, every employee of every company is alarmed when the CEO gets fired – and pays close attention to both the why and the how. After all, if the Company can fire its number one employee on a whim,  what about me? Could I too get fired over nuances? A company with such a culture cannot sustainably retain high caliber people – and Teva’s people are this company’s main asset. Without faith in the decency of the Company and trust in its Board and Management, Teva’s best people could leave. I believe that trust was dealt a serious setback by the Board’s handling of Jeremy Levin’s departure.

So why do I care? Well, Teva is more than just another company. Teva is Israel’s only truly global enterprise. It is the flagship of Israeli industry. So when Teva looks bad, Israel looks bad. When Teva appears to be an unsavory place to invest, so does Israel. And when Teva’s board fired Jeremy Levin, shamefully as it did, as an Israeli I too felt shame. And that’s when Teva became more than just an investment. That’s why I care about Teva.

Becoming an Investor Activist

The Levin debacle and my futile attempt to prevent it, together with a growing sense that something is wrong with the way this corporation is governed, combined into a strong feeling that somebody has to do something.

I have never been an “investor activist”. But I am an “activist” when it comes to things that I care about deeply.

I am an “activist” when it comes to my own businesses, which I attempt to imbue with company culture and values that I believe are the secret to their success. Companies whose employees love their jobs, are deeply accepting and respectful of one another, exalt hard work, are not afraid to fail and are willing to undertake the seemingly impossible. In other words, I have tried to create in each of the companies that I started a microcosm of Israeli society as I would have it. That’s what I did in my first company, Indigo (which was acquired by Hewlett-Packard in 2002) and that’s what I am doing today in both Landa Labs (a nanotech research company) and in Landa Digital Printing (developing digital printing presses for mainstream markets). This work consumes my fourteen-hour days and I really don’t have time for much else.

I am also an activist when it comes to trying to resolve the peace impasse between Israel and its neighbors (through BTI, “Breaking the Impasse”, a joint Israeli-Palestinian initiative which attempts to influence the leadership of both sides for a two-state solution). I believe that the only alternative to a two state solution is a one state solution, which would ultimately be disastrous for Israel.

And now I am an activist when it comes to Teva. Not an “investor activist” in the usual sense of someone seeking to leverage his influence for personal gain. Of course, I share with other investors the desire for Teva’s value to appreciate. However, for me, the importance of Teva’s success goes beyond enhanced shareholder value. Only successful companies can guarantee their independence. Only a successful Teva can guarantee its future as an Israeli company, as a major source of employment, a major exporter of goods and a major contributor of value to Israel’s economy. Only a successful Teva can continue to be the flagship of Israeli industry and the symbol of our country’s scientific and commercial success.


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