Global drugs company GSK has agreed to a $13 billion (€10.46 billion) deal to acquire Novartis’ 36.5% stake in its consumer healthcare joint venture.
The move supports efforts to improve performance and capital planning for GSK, while allowing its shareholders to capture the full value of future performances, according to the company.
The group said it expects the transaction to be ‘accretive’ to adjusted earnings in 2018 and thereafter, and to strengthen cash flow generation.
Reviews
To support GSK’s transaction, the company is reviewing its Horlicks brand as well as its 72.5% stake in its Indian subsidiary GlaxoSmithKline Consumer Healthcare.
GSK expects the outcome of this strategic review to conclude around the end of 2018, but added that there can’t be any assurance that the process will result in any transaction.
“The proposed transaction addresses one of our key capital allocation priorities and will allow GSK shareholders to capture the full value of one of the world’s leading consumer healthcare businesses,” said Emma Walmsley, CEO, GSK.
“For the group, the transaction is expected to benefit adjusted earnings and cash flows, helping us accelerate efforts to improve performance,” she added. “Most importantly it also removes uncertainty and allows us to plan use of our capital for other priorities, especially pharmaceuticals R&D.”
© 2018 - Checkout Magazine by Kevin Duggan
