GSK spends $900 million to raise India subsidiary stake

LONDON Tue Feb 5, 2013 2:43pm IST

A GlaxoSmithKline logo is seen outside one of its buildings in west London, February 6, 2008. REUTERS/Toby Melville/Files

A GlaxoSmithKline logo is seen outside one of its buildings in west London, February 6, 2008.

Credit: Reuters/Toby Melville/Files

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LONDON (Reuters) - GlaxoSmithKline Plc (GSK.L) has lifted its stake in its publicly-listed Indian consumer healthcare subsidiary to 72.5 percent from 43.2 percent, deepening its footprint in emerging markets and non-prescription products.

David Redfern, GSK's chief strategy officer, said on Tuesday the transaction - valued at 48 billion Indian rupees or 568 million pounds - would further increase exposure to a key emerging market.

"It is a significant vote of confidence in the long-term growth prospects of our consumer healthcare business in India," he added.

Britain's biggest drugmaker announced plans to acquire larger holdings in both its Indian and Nigerian consumer product businesses in November.

GSK offered 3,900 rupees per share for stock in Indian-based GlaxoSmithKline Consumer Healthcare Ltd (GLSM.NS) during a tender period that ran from January 17 to January 30, with final payment due on or before February 13. The open offer was managed by HSBC.

Shares in the Indian company were 2 percent lower at 3,750 rupees following news of the open offer result, while GSK was 0.5 percent higher, ahead of the group's full-year results on Wednesday.

The drugmaker's Indian arm sells popular brands such as health drink Horlicks, malt-based drink Boost and a multi-vitamin drink VitaHealth, which is marketed to women. It also markets OTC (over-the-counter) drugs such as paracetamol tablet Crocin, painkiller gel Iodex and acidity reliever Eno.

In Nigeria, GSK's plans to raise its holding in GlaxoSmithKline Consumer Nigeria Plc (GLAXOSM.LG) to 80 percent in a 15.4 billion naira deal are still progressing.

(Reporting by Ben Hirschler; Editing by Mark Potter)

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