Smithkline, Glaxo Call Off Mega-Merger

Drug maker SmithKline Beecham PLC called off merger talks with Glaxo Wellcome PLC, citing “insurmountable differences” in putting together what would have been the biggest corporate combination in history.

The talks ended Monday evening in London, Glaxo spokesman Rick Sluder said, without elaborating.

In its announcement, SmithKline said the negotiations began falling apart Friday after Glaxo sought to change terms of a tentative deal announced Jan. 30.

That created “insurmountable differences” that left the two British drug makers “unable to agree on the terms of a possible merger,” SmithKline said.

Discussions since Friday, it said, “revealed a number of differences between the companies, including differences in the approach to the possible merger, management philosophy and corporate culture.”

“Most importantly, Glaxo’s recent conduct of these discussions has inevitably strained relations between the two companies,” it said.

SmithKline said its board unanimously decided against recommending to shareholders a merger in which the company would have been the junior partner.