GSK to invest $940 mn in Indian unit
Shares of GSK Consumer Healthcare surged 20% to a 12-month high on the Bombay Stock Exchange today after GlaxoSmithKline Plc said it wants to increase its stake in the Indian subsidiary.business Updated: Nov 26, 2012 22:13 IST
Shares of GSK Consumer Healthcare surged 20% to a 12-month high on the Bombay Stock Exchange on Monday after GlaxoSmithKline Plc said it wants to increase its stake in the Indian subsidiary.
GSK will spend Rs. 5,221 crore ($940 million) to acquire this incremental stake from the present 43.2% to 75%, which is the maximum a promoter can own in a listed company, the firm said.GSK has offered Rs. 3,900 per share, a premium of 28% to Friday’s closing price.
“GSK Consumer Healthcare is a well established business in India and its leading product, Horlicks, is an iconic household brand,” said David Redfern, chief strategy officer, GSK. “This transaction is a further step in GSK’s strategy to invest in the world’s fastest growing markets.”
Shareholders are also happy. “The news is positive for shareholders as it’s already helped them fetch a premium of about 30%,” said industry analyst V Srinivasan of Angel Broking.
GSKConsumer Healthcare stocks closed 608 points up to 3,652 on the BSE on Monday.