Pfizer will sell a stake in GSK’s consumer health business once it enters the list

  • GSK said in February that Pfizer would retain its stake in Haleon
  • Haleon is expected to be registered in London on July 18
  • GSK has rejected Unilever’s £ 50bn bid for Haleon

LONDON, June 1 (Reuters) – Pfizer (PFE.N) plans to sell a 32% stake in Haleon, its consumer healthcare company to British drug maker GSK (GSK.L), after the business list is an independent company. in July, GSK said on Wednesday.

GSK is releasing Haleon, which produces Sensodyne toothpaste and the painkiller Advil, so it can focus on vaccines and prescription drugs. GSK turned down a £ 50bn ($ 63bn) bid for Haleon last year, saying it underestimated the company.

Pfizer had previously said it wanted to sell its stake in Haleon, but GSK, which owns 68% of the world’s largest healthcare business, said in February that the US drugmaker would retain its stake after the market.

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A Pfizer spokesman said Wednesday that the US company has always intended to sell its stake in Haleon over time.

GSK applied to the British regulator for listing of Haleon on the London Stock Exchange on July 18 and stated that it expects to apply for listing on the New York Stock Exchange soon.

Pfizer, GSK and other current stakeholders in Haleon have committed to a blockade period until November so as not to jeopardize the shares of the newly independent company, GSK said.

Expectations for the consumer healthcare company’s market valuation are high after GSK rejected a £ 50bn bid from Unilever (ULVR.L), which dropped its pursuit in January.

If GSK provides an estimate of £ 50 billion or more, it will be the largest market capitalization listing on the London Stock Exchange in at least two decades, with the exception of joint listings made through the Shanghai London Stock Connect project.

By comparison, the mining and trading company Glencore (GLEN.L) was valued at £ 36.7 billion when it was registered in London in 2011.

BOARD MEMBERS

GSK also said in February that once Haleon was listed as a separate company, Pfizer would appoint two members to its new board and the British drugmaker would relinquish its representation. Read more

Currently, Brian McNamara, GSK’s Chief Executive Officer for Consumer Health, has been appointed Chief Executive Officer of Haleon after he was added to the list, while Tobias Hestler of GSK is appointed Chief Financial Officer.

A Pfizer spokesman said the company was granted the right to participate on the board when the venture was originally announced a few years ago and Pfizer is still interested in Haleon.

“We cannot speculate on what happens when we give up our interest,” the spokesman said.

Haleon was ready to generate above-market medium-term annual organic revenue growth of 4% to 6%, GSK said.

Haleon’s closest competitors in the over-the-counter, vitamin and oral care market are Procter and Gamble, Colgate-Palmolive, Johnson & Johnson (JNJ.N) and Bayer.

Prior to the spin-off, Haleon’s holding company will pay dividends to GSK and Pfizer. GSK has said it will receive more than £ 7bn in cash from the spin-off.

After the spin-off, at least 54.5% of Haleon’s total ordinary share capital will be held by GSK shareholders and 6% by GSK, the company said.

Following the split, GSK will focus on pharmaceuticals and vaccines and can no longer rely on stable sales for consumer health to compensate for some of the unpredictability of drug development.

Under pressure from shareholders as activist investor Elliott, GSK sought to strengthen its drug pipeline.

He also made acquisitions by agreeing to buy cancer drug developer Sierra Oncology (SRRA.O) in a $ 1.9 billion deal and revealed plans to pay up to $ 3.3 billion for vaccine developer Affinivax. Read more

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Report by Natalie Grover in London and Ludwig Burger in Frankfurt; Additional reports by Lucy Raitano in London; Edited by Josephine Mason, Edmund Blair and David Clark

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