GlaxoSmithKline PLC GSK GSK to increase stake in its Indian consumer co.

  GlaxoSmithKline PLC (GSK) - GSK to increase stake in its Indian consumer co.

RNS Number : 9617R
GlaxoSmithKline PLC
26 November 2012


Issued: Monday 26 November 2012, London UK - LSE announcement





GSK initiates voluntary open offer to increase stake in its publicly-listed
Consumer Healthcare subsidiary in India





GlaxoSmithKline ("GSK") (LSE: GSK) today announced a Voluntary Open Offer (the
"Offer") to increase its stake in its publicly-listed Consumer Healthcare
subsidiary in India (GlaxoSmithKline Consumer Healthcare Ltd, the "Company")
from 43.2% to up to 75% at a price of INR 3,900 per share. Securities
regulations in India require a minimum public shareholding of 25% for a
company to maintain a public listing in the country. 



The Offer, which is made pursuant to the rules of the Securities and Exchange
Board of India, is to acquire up to 13,389,410 shares, representing 31.8% of
the total outstanding shares of the Indian Company. The Offer represents a
premium of approximately 28% to the Company's closing share price on the
National Stock Exchange of India Limited on 23 November, 2012 and 22% to the
12 month high on BSE Ltd. The potential total value of the transaction at the
Offer price is approximately INR 52.2 billion or £591 million.



David Redfern, Chief Strategy Officer, GSK said: "GSK Consumer Healthcare is a
well established business in India and its leading product, Horlicks, is an
iconic household brand. This transaction represents a further step in GSK's
strategy to invest in the world's fastest growing markets and, we believe,
offers a liquidity opportunity at an attractive premium for existing
shareholders."



The transaction will be funded through GSK's existing cash resources, will be
earnings neutral for the first year and accretive thereafter and will not
impact expectations for the Group's long-term share buyback programme.



GSK's Consumer Healthcare business in India generated over INR 28 billion
turnover in the financial year ended 31 December, 2011 (approximately £380
million at 2011 average exchange rates) with a Compound Annual Growth Rate
(CAGR) over the past five years of 19%. The Company employs approximately
3,200 people.



Subject to regulatory clearance, the Offer period is expected to begin in
January 2013. Payment for the shares will take place shortly after close of
the Offer. The Company's shares are traded on the BSE Ltd (500676) and the
National Stock Exchange of India Limited (GSKCONS).



The details of the Offer can be found in the public announcement which will
shortly be available at www.sebi.gov.in, www.bseindia.com, and
www.nseindia.com, and the detailed public statement and letter of offer which
will be filed in connection with the Offer with relevant stock exchanges and
the Securities Exchange Board of India.



The Offer is being managed by HSBC Securities and Capital Markets (India)
Private Limited.



V A Whyte

Company Secretary

26 November 2012









Accounting Information

GSK will continue to consolidate 100% of the results and net assets of the
Company, but the share of profits due to the non-controlling interests and the
non-controlling interests balance in the balance sheet will both be lower
after the transaction. GSK will record no gain or loss on the acquisition,
with the accounting entries being recorded in non-controlling interests and
shareholders' equity.



GlaxoSmithKline - one of the world's leading research-based pharmaceutical and
healthcare companies - is committed to improving the quality of human life by
enabling people to do more, feel better and live longer. For further
information please visit www.gsk.com





GlaxoSmithKline Enquiries:
UK Media enquiries:               David Mawdsley  +44 (0) 20  (London)
                                                  8047 5502
                                  Sarah Spencer   +44 (0) 20  (London)
                                                  8047 5502
India Media enquiries - Genesis   Rohit Moudul    +91 981 106 (India)
Burson-Marsteller                                 2853
US Media enquiries:               Stephen Rea     +1 215 751  (Philadelphia)
                                                  4394
                                  Mary Anne Rhyne +1 919 483  (North Carolina)
                                                  0492
Analyst/Investor enquiries:       Sally Ferguson  +44 (0) 20  (London)
                                                  8047 5543
                                  Lucy Budd       +44 (0) 20  (London)
                                                  8047 2248
                                  Tom Curry       + 1 215 751 (Philadelphia)
                                                  5419
                                  Gary Davies     + 44 (0) 20 (London)
                                                  8047 5503
                                  James Dodwell   + 44 (0) 20 (London)
                                                  8047 2406
                                  Jeff McLaughlin + 1 215 751 (Philadelphia)
                                                  7002
                                  Ziba Shamsi     + 44 (0) 20 (London)
                                                  8047 3289
India Analyst/Investor enquiries  Minari Shah     +91 986 762 (India)
- The Hongkong and Shanghai                       2759
Banking Corporation Ltd.          
                                                  





Cautionary statements
Under the safe harbor provisions of the U.S. Private Securities Litigation
Reform Act of 1995, GSK cautions investors that any forward-looking statements
or projections made by GSK, including those made in this announcement, are
subject to risks and uncertainties that may cause actual results to differ
materially from those projected. Factors that may affect GSK's operations are
described under 'Risk factors' in the 'Financial review & risk' section in the
GSK Annual Report 2011 included as exhibit 15.2 to the company's Annual Report
on Form 20-F for 2011.



This announcement is not intended to, and does not, constitute or form part of
any offer, invitation or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of, any securities whether
pursuant to this announcement or otherwise. The distribution of this
announcement in certain jurisdictions may be restricted by law and therefore
persons into whose possession this announcement comes should inform themselves
about, and observe, such restrictions. Any failure to comply with the
restrictions may constitute a violation of the securities law of any such
jurisdiction.
















Registered in England & Wales:
                                                      
No. 3888792
                                                      
Registered Office:

980 Great West Road
                                                      
Brentford, Middlesex

TW8 9GS









                     This information is provided by RNS
           The company news service from the London Stock Exchange

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