GSK to spin off consumer healthcare arm in City float

GLAXOSMITHKLINE is to spin off its £40bn consumer arm in a flotation next month that will allow junior investor Pfizer to sell a 32pc stake.

Haleon, whose brands include Sensodyne and Panadol, will join the London Stock Exchange’s premium segment on July 18 and is likely to enter the FTSE 100 in September during the index’s quarterly reshuffle.

GSK said yesterday that shares are expected to begin trading on July 18 after the company submitted its prospectus to the Financial Conduct Authority for approval. It will pursue a secondary listing on the New York Stock Exchange.

Pfizer will “exit its 32pc ownership interest in Haleon in a disciplined manner, with the objective of maximising value” for the US drugmaker’s shareholders, GSK said.

The deal will be London’s biggest float for a decade and comes after years of pressure on Emma Walmsley, GSK’S chief executive, to sell off the consumer division, whose other brands include Advil and Centrum.

Ms Walmsley will remain at GSK, where she has been fighting off pressure from the US activist investor Elliott over her lack of a scientific background.

Analysts expect the Haleon business to be worth between £40bn and £50bn. GSK turned down a £50bn bid from Unilever last year, arguing that it undervalued the company, and had been seeking a valuation of up to £60bn.

Elliott last year said GSK’S 68pc stake was worth around £30bn.

Sir Dave Lewis, the ex-tesco chief executive, has been appointed as Haleon’s chairman, while the company will be run by Brian Mcnamara, who has led GSK’S consumer division since 2016.

While Pfizer will sell down its stake, GSK investors will become shareholders in Haleon, owning around 55pc of the company. The company itself will retain a smaller stake which it plans to sell down over time. GSK had said earlier that Pfizer would retain its stake in the company.

GSK said this week it would pay up to £2.6bn for Boston-based vaccine maker Affinivax as it focuses more on pharmaceuticals ahead of spinning off the consumer arm.