GSK agrees joint venture with Pfizer
GlaxoSmithKline and Pfizer have agreed to combine their consumer healthcare businesses into a single venture with annual sales approaching £10 billion.
The agreement will see brands such as Panadol, Sensodyne, Advil and Centrum come under the joint company which will reportedly operate under the name GSK Consumer Healthcare.
There will be six GSK and three Pfizer directors on the new board. GSK will have a 68% equity interest and Pfizer a 32% interest in the venture.
The deal requires approval by shareholders and regulators but GSK intends to create two new UK-based businesses, one focusing on prescriptions and vaccines, the other on consumer health, within three years of the deal closing.
“Through the combination of GSK and Pfizer’s consumer healthcare businesses we will create substantial further value for shareholders. At the same time, incremental cashflows and visibility of the intended separation will help support GSK’s future capital planning and further investment in our pharmaceuticals pipeline,” said GSK chief executive officer Emma Walmsley.
“With our future intention to separate, the transaction also presents a clear pathway forward for GSK to create a new global pharmaceuticals/vaccines company, with an R&D approach focused on science related to the immune system, use of genetics and advanced technologies and a new world-leading consumer healthcare company.
“Ultimately, our goal is to create two exceptional, UK-based global companies, with appropriate capital structures, that are each well positioned to deliver improving returns to shareholders and significant benefits to patients and consumers.”
Albert Bourla, Pfizer’s chief operating officer and incoming chief executive officer, said: “The combination of these leading businesses with distinct regional and category strengths will be more sustainable and broader in scope than either company individually.
“We believe that this joint venture is a great opportunity to ensure the future success of Pfizer Consumer Healthcare while unlocking meaningful after-tax value for Pfizer shareholders.”
(Picture: William Barton - iStock)