GlaxoSmithKline and Pfizer to merger consumer healthcare units
The British and US pharmaceutical firms, GlaxoSmithKline (GSK) and Pfizer, have announced they will merge their consumer health businesses.
The combined unit will have an annual sales total of £9.8bn ($12.7bn).
GSK will own the majority of the joint venture with 68%, whilst Pfizer will have the remaining 32% of equity interest.
“The new Joint Venture will be well-positioned to deliver stronger sales, cash flow and earnings growth driven by category leading Power Brands, science-based innovation and substantial cost synergies,” read GSK’s press release.
The merging brands include GSK’s Sensodyne, Voltaren, and Panadol, and Pfizer’s Advil, Centrum, and Caltrate.
The Chief Executive Officer of GSK, Emma Walmsley, has been appointed Chair of the joint venture.
“Eighteen months ago, I set out clear priorities and a capital allocation framework for GSK to improve our long-term competitive performance and to strengthen our ability to bring new breakthrough medicines and better healthcare products to people around the world,” stated Walmsley.
“We have improved our operating performance and have set out a new approach to R&D. We have also started to reshape the Group’s portfolio through prioritisation of R&D programmes, acquisitions such as that proposed with the oncology biopharmaceutical company, TESARO, the minority buy-out of the consumer healthcare business and a series of non-core product divestments.”
“The transaction we have announced today is a unique opportunity to accelerate this work. 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.”
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