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PDL BioPharma CEO to Step Down

Mark McDade, long a target of investor Third Point, will leave the drug company by the end of the year.

Investors reacted enthusiastically to

PDL BioPharma

(PDLI) - Get PDL BioPharma, Inc. Report

CEO Mark McDade's decision to step down by the end of the year, boosting shares about 6% on Monday.

The company said McDade would step down from his role as both CEO and board member in light of the personal toll he's incurred from rumors and an investigation, though the probe found no evidence of wrongdoing.

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Hedge fund Third Point, PDL's largest shareholder, has publicly criticized the company's management and called for McDade's firing.

PDL said a three-month internal investigation conducted by its audit committee and two independent law firms found no credible evidence of improper conduct or breach of fiduciary duty by McDade. Specifically, there was no evidence of a conflict of interest regarding McDade and an alleged relationship with another officer at the company.

The investigation also found that McDade didn't improperly withhold information from the board regarding an alleged offer from another pharmaceutical company to acquire PDL. No evidence of such an offer was found, according to the company.

PDL BioPharma has formed a committee of independent directors who will begin conducting a search for the new CEO immediately. Chairman L. Patrick Gage will assume the role of executive chairman and assist in the transition to a new CEO.

The company is also in the midst of a strategic review with the help of Merrill Lynch.

Shares rose $1.34, or 6.3%, to $22.50.