GSK looks to put Horlicks on the block
Plc. (GSK) is exploring a partial or full sale of its 72.5% stake in its Indian unit GSK Consumer Healthcare Ltd, besides separately selling the company’s dietary supplement brand Horlicks as it looks to fund its $13 billion buyout of Novartis’s stake in a global consumer healthcare joint venture.
“The company is initiating a strategic review of Horlicks and its other consumer healthcare nutrition products to support funding of the transaction. The strategic review also includes assessment of the company’s stake in Indian entity,” GSK chief executive Emma Walmsley said in a conference call with reporters on Tuesday. The decision is part of GSK’s plan to “drive increased focus on over-the-counter (OTC) and oral health categories”.
“Dilution of stake or a complete exit cannot be ruled out. The company has been having a tough time during the past three years. And GSK needs $13 billion in total to fund the Novartis deal,” said a Mumbai-based equity analyst, asking not to be named.
The outcome of the strategic review, said GSK, will be concluded around the end of 2018. “There can be no assurance that the review process will result in any transaction,” GSK said. According to GSK, the company will increase focus on OTC and oral health categories. This portfolio includes Sensodyne toothpaste, Eno antacid, Panadol headache tablets, muscle gel Voltaren and Nicotinell patches, among others.
The combined sales of Horlicks and other nutrition products were approximately £550 million in 2017, GSK said in its statement. Nearly 85-90% of total Horlicks sales come from the Indian market.
NEWDELHI:GlaxoSmithKline