GlaxoSmithKlineNSE 0.56 % said it is considering a possible deal that includes a merger of its Indian unit GSK Consumer Healthcare (GSKCH), although no decision has been taken on the matter.
“In response to recent press speculation, GSK confirms that consideration is being given to a potential transaction that includes a merger of GSKCH. There can be no assurance that a transaction will result from the review process or the evaluation of this option nor has any decision on the matter been made by the company,” GSK said in a notification to the London Stock Exchange on Thursday.
The Financial Times reported on Wednesday that GSK has entered into exclusive negotiations to sell its nutrition business to UnileverNSE 1.03 % for an estimated $4 billion, including the popular Horlicks malted drink brand. The deal is expected to include GSK’s Bangladesh-listed business, the FT report said.
Hindustan Unilever on Thursday said it cannot disclose details on whether it plans to buy GlaxoSmithKline’s Indian Horlicks nutrition business, citing confidentiality obligations.
“As disclosed previously, in March 2018, GSK announced a strategic review of Horlicks and its other consumer healthcare nutrition products. The majority of Horlicks and other GSK nutrition products sales are generated in India by GSKCH,” the company said in the notification.
Following the FT report, Bloomberg reported that Unilever has edged out Swiss foods and beverage company NestleNSE 1.26 % in the contest for GSK’s $4 billion Indian consumer-health unit.
Coca-Cola had been shortlisted to join the final round of the auction for the business, which began in September, but opted out, people aware of the developments said. Unilever is said to have won the bid after revising its initial share swap offer into an all-cash offer of $3.4 billion for a 72.5% stake.
GSKCH shares have gained about 18% on the BSE in the past year in anticipation of the divestment, outperforming the benchmark Sensex, which gained 6.24% in the period.
Source: Economic Times