Glaxo Heads for Record in India Ahead of Consumer Business Sale
(Bloomberg) -- GlaxoSmithKline Consumer Healthcare Ltd. is headed for a record high after parent GlaxoSmithKline Plc was said to have requested bids by mid-September for its Indian consumer-health unit.
Shares of the Indian unit rose as much as 8.3 percent, the biggest intraday advance since Feb. 14, and were set for a record close in Mumbai. Glaxo has sent out an information memorandum with preliminary details about the business to possible suitors, people with knowledge of the matter said Aug. 21. The sale has attracted interest from potential bidders including Nestle SA, PepsiCo Inc. and Reckitt Benckiser Group Plc, they said.
The U.K. drugmaker announced in March that it aims to complete a strategic review of popular malted milk brand Horlicks and other nutritional products by the end of this year. The company is assessing its 72.5 percent holding in GlaxoSmithKline Consumer as part of that process. Proceeds from a potential sale could be used to finance Glaxo’s $13 billion buyout of Novartis AG’s stake in their consumer-health joint venture.
Glaxo’s review of assets includes its 82 percent stake in the Dhaka-listed GlaxoSmithKline Bangladesh Ltd., as well as marketing rights to some consumer-health brands in other emerging economies including Malaysia, the people said. There’s no certainty the deliberations will lead to a transaction, and the parent company may yet decide to keep the businesses, they said.
Shares of the Indian unit traded at 7,568.90 rupees as of 10:50 a.m. in Mumbai, adding 6.5 percent in a third straight day of gains.
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