Unilever Agrees to Buy GlaxoSmithKline Health Food Drinks Portfolio In India
December 03 2018 - 4:25AM
Dow Jones News
By Ian Walker and Oliver Griffin
Unilever PLC (ULVR.LN) said Monday that it has agreed to buy
GlaxoSmithKline PLC's (GSK.LN) health food drinks portfolio in
India--which houses the Horlicks brand, a malted-milk drink--for
3.3 billion euros ($3.73 billion).
The Anglo-Dutch consumer goods company said the deal consists of
three parts, including an all-equity merger of Hindustan Unilever
Ltd. with the publicly-listed GSK Consumer Healthcare India.
The deal ends a months-long auction process that also drew
interest from Nestle SA (NESN.EB) and Coca-Cola Co. (KO), which
were eager to bolster their presence in one of the world's most
promising consumer markets.
As well as the all-share merger between the two subsidiaries,
Unilever said it will acquire an 82% stake in GlaxoSmithKline's
business in Bangladesh for EUR169 million. It will also acquire
GlaxoSmithKline's commercial operations in 20 other predominantly
Asian markets, and the associated intellectual property rights, for
EUR470 million.
Horlicks is popular in India and mainly sold through
GlaxoSmithKline Consumer Healthcare Ltd., the big U.K.-based drug
maker's majority-owned Indian unit.
Unilever said that the total consideration for the transaction
is EUR 4.6 billion, of which its implied contribution totals EUR3.3
billion.
Unilever, which already houses Ben & Jerry's ice cream, Dove
soap and Lipton tea among its portfolio said the transaction is
aligned with its strategy of increasing its presence in health-food
categories and in high-growth emerging markets.
GlaxoSmithKline plans to use the proceeds to support its own
strategic priorities and reduce its debt. The transaction is
expected to have no effect on earnings, GlaxoSmithKline said.
Write to Ian Walker and Oliver Griffin at ian.walker@wsj.com;
@IanWalk40289749 and oliver.griffin@dowjones.com; @OliGGriffin
(END) Dow Jones Newswires
December 03, 2018 04:10 ET (09:10 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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