GSK to divest Horlicks to Unilever | Sunday Observer

GSK to divest Horlicks to Unilever

Following the completion of its previously announced strategic review, Glaxo Smith Kline PLC will divest Horlicks and other consumer healthcare nutrition brands to Unilever PLC and the merger of GSK Consumer Healthcare Limited (GSK India) with Hindustan Unilever Limited (HUL) for approximately £ 3.1 billion based on HUL shares of INR 1,717.

In India, Horlicks and other nutrition products are sold by GSK India, a public company listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE), in which GSK holds a 72.5% stake. The proposed transaction involves the merger of GSK India with HUL, a public company listed on the NSE and BSE, following which GSK will own approximately 5.7% of HUL. The merger values GSK India at INR 317 billion, or INR 7,540 per share.

Following completion of the transaction, currently expected to be by the end of 2019, GSK will sell its holding in HUL. It will take into account market conditions. GSK will also sell its 82% stake in Glaxo Smith Kline Bangladesh Limited, (and other related brand rights for GSK’s consumer healthcare nutrition activities in certain other territories) to Unilever, for which it is expected to receive cash proceeds equivalent to £566 million.

Chief Executive Officer, GSK, Emma Walmsley said, “Horlicks has made a significant contribution to GSK and to the health of consumers across India, for many decades, and we believe Unilever is well placed to maximise its future potential. Proceeds from this transaction will be used to support the Group’s strategic priorities, including investing in our pharmaceutical business.”