Jim Armitage: Sir Philip Hampton won’t spill but his GSK exit seems far too soon

Few City careers have been as lustrous as Sir Philip Hampton’s.

Though he never achieved hallowed chief executive status, his career took him to roles as finance director at British Steel, British Gas, British Telecom and Lloyds. He went on to chair Sainsbury’s alongside chief Justin King, then UK Financial Investments, RBS and, finally GSK.

Since arriving at the drugs giant, he’s staged little short of a revolution. In less than four years, he’s replaced the chief executive, revamped the board and overseen the biggest corporate restructuring in its recent history. The project will see it merge with Pfizer’s non-prescription medicines business then split into two. So much has been going on that you could almost overlook the $5 billion takeover of cancer medicines giant Tesaro and the £2 billion sale of brands like Horlicks.

The turmoil all this will create cannot be underappreciated. The acquisitions and disposals have to be executed with as little disruption as possible. Then the company has to be disentangled into two vast, separate companies, each with its own board and corporate structure.

So it seems decidedly odd that the chairman should announce he’s quitting now, when it so badly needs stability in management rather than yet more moving parts. Particularly as its new finance director only started last week.

When I told a senior City figure the Hampton news this morning, he nearly fell off his Davos chairlift. “Unbelievable,” was his verdict.

GSK would have you believe there’s nothing odd about it. Hampton is 65, so it’s a good age to retire. Really? Four years is a short lifespan for a CEO, let alone a chairman. FTSE chairs usually last at least eight years,and often serve into their seventies.

Indeed, the current restructuring and demerger process will probably take three years to do, so the logical timescale now would be for Hampton to see the demerger through, recruit the two new boards (and chairmen), then retire gracefully at 68.

It’s hard not to think something peculiar has happened here — a disagreement over strategy? A personality clash? A year ago there was gossip — strenuously denied — that he was pushing a reluctant chief executive Emma Walmsley to consider a break-up. Did that create a rift?

No, says GSK, and there is none now. He just decided to quit when the Pfizer deal was announced.

Hampton is not the type to spill the beans, so I suspect we will never know. Whatever his reasons, shareholders owe him their gratitude. Walmsley is proving an inspired hire and GSK is undergoing the dramatic restructuring that it has long required.

Bravo, Sir Philip, enjoy a (youthful) retirement.

Since the obvious merger with Deutsche Börse cannot be done, the London Stock Exchange is in a cul-de-sac; too small to compete with the exchange giants, banned from teaming up with its most obvious suitor.

Beefing up in Oslo feels an unconvincing solution.