GlaxoSmithKline Plc’s Horlicks drink products, center, are displayed in a local grocery store in the Kalahati market area in Siliguri, West Bengal, India (Photographer: Sanjit Das/Bloomberg)  

Glaxo to Examine Sale of $3.1 Billion India Consumer Unit Stake

(Bloomberg) -- U.K. pharmaceutical giant GlaxoSmithKline Plc will examine selling the stake it holds in its Indian consumer health subsidiary, worth about $3.1 billion, as it looks for ways to finance a buyout of the joint venture partner in its global consumer healthcare business.

The strategic review of its 72.5 percent stake in a publicly-traded Indian unit, GlaxoSmithKline Consumer Healthcare Ltd., is expected to be completed around the end of 2018 and may not result in a transaction, the company said in a statement. Malted milk drink brand Horlicks -- which gets most of its sales through the Indian consumer health unit -- will also be part of the process, the company said.

Proceeds from a potential sale would be used to finance Glaxo’s $13 billion buyout of Novartis AG’s stake in their consumer-health joint venture. Shares of GlaxoSmithKline Consumer were up 2.1 percent at 6,665 rupees a piece as of 1:18 p.m. in Mumbai.

"India remains a priority market," the company said in a statement, saying it will continue to invest in over-the-counter medicines and oral health brands, such as its Sensodyne toothpaste, antacid Eno, as well as its pharmaceutical and vaccine businesses.

Glaxo has one publicly-traded subsidiary in India for its pharmaceutical business and another for its consumer health unit. Revenue at the consumer unit has decreased the last two years, according to data compiled by Bloomberg.

©2018 Bloomberg L.P.

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