Glaxo CFO Says Multibillion-Dollar M&A Not ‘on the Cards’

GlaxoSmithKline PLC, the U.K.’s largest drugmaker, isn’t considering large-scale acquisitions, Chief Financial Officer Simon Dingemans said.

“Our emerging-markets business made a number of acquisitions two or three years ago,” Dingemans said in an interview today with Betty Liu on Bloomberg Television’s “In the Loop.” “We’re very comfortable with the footprint we have. If we do any M&A it’s going to be relatively small bolt-ons and in-fills.”

Dingemans was responding to a questions about news reports that Glaxo and other companies are considering acquiring Brazilian drugmaker Ache Laboratorios Farmaceuticos SA. Glaxo is seeking to capture more growth in emerging markets. The company increased its stake in an Indian consumer-health subsidiary to 73 percent from 43 percent, and also is buying shares in its Nigerian unit.

Closely held Ache had 2011 sales of about $1.5 billion, according to the company’s website. Drug companies in emerging markets are priced in the stock market at about 2.45 times sales, based on the median multiple in data compiled by Bloomberg. At that multiple, the Brazilian company would be valued at about $3.7 billion.

Spending billions of dollars on an acquisition isn’t “on the cards,” Dingemans said today.

Glaxo is looking mostly at acquisitions of early-stage compounds and technologies, rather than focusing on spending billions of dollars to buy experimental medicines in late stages of testing, Patrick Vallance, the drugmaker’s head of pharmaceuticals research and development, said in an interview last month.

To contact the reporter on this story: Makiko Kitamura in London at

To contact the editor responsible for this story: Phil Serafino at

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