Pfizer exits GSK’s consumer healthcare arm after split


By Natalie Grover and Ludwig Burger

LONDON (Reuters) – Pfizer plans to exit its 32% stake in Haleon, a consumer healthcare joint venture with British drugmaker GSK, after the business was spun off as an independent listed company in July, announced GSK on Wednesday.

Pfizer previously announced it would seek to sell its stake in Haleon, the world’s largest consumer health company and home to Sensodyne toothpaste and Advil painkillers.

But GSK, which owns a 68% majority stake in Haleon, said in February that the US drugmaker would retain its stake. He had also said that Pfizer would appoint two members to Haleon’s board of directors while GSK would forfeit its representation.

GSK’s latest statement suggested candidates for Pfizer’s board would stay on even if the US drugmaker plans to sell, although GSK said Pfizer would step down in a “disciplined manner”.

The British drugmaker also said GSK plans to monetize its stake in Haleon in a “disciplined” way.

GSK asked the UK regulator to list Haleon on the London Stock Exchange on July 18 and said it plans to apply to list the healthcare company on the New York Stock Exchange soon.

Haleon was on track to deliver above-market mid-term annual organic revenue growth of 4% to 6%, GSK said.

Haleon’s closest competitors in the over-the-counter drug, vitamin and oral care markets are Procter and Gamble, Colgate-Palmolive, Johnson & Johnson and Bayer.

GSK last year rejected a 50 billion pound ($68 billion) bid for Unilever’s Haleon, saying it was undervaluing the company. Unilever dropped its lawsuit in January.

Before the spin-off, Haleon’s holding company will pay dividends to GSK and Pfizer. GSK said it would receive cash proceeds of more than £7 billion on separation.

After the split, at least 54.5% of Haleon’s total issued ordinary share capital would be held by GSK shareholders and 6% would be held by GSK, the company said.

After the split, GSK will focus on pharmaceuticals and vaccines, but will no longer be able to rely on stable revenues from consumer healthcare to offset some of the unpredictability in drug development.

Under pressure from shareholders such as activist investor Elliot, GSK sought to shore up its drug pipeline.

It also made acquisitions, agreeing to buy cancer drug developer Sierra Oncology in a $1.9 billion deal and unveiling plans to pay up to $3.3 billion for the developer. Affinivax vaccines.

($1 = 0.7933 pounds)

(Reporting by Natalie Grover in London and Ludwig Burger in Frankfurt; Twitter: @NatalieGrover; Editing by Josephine Mason and Edmund Blair)


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