Dec. 20 (Bloomberg) -- Prestige Brands Holdings Inc., maker of Comet cleaner and Murine eye and ear solutions, agreed to buy 17 over-the-counter medicine brands from GlaxoSmithKline Plc for $660 million. The stock gained the most since April 2009.
The deal will add about $500 million in annual revenue, Irvington, New York-based Prestige said today in a statement. In fiscal 2011, the company earned $29.2 million on revenue of $337 million.
The purchase includes digestive helpers Beano and Gaviscon, painkillers Ecotrin and Goody’s, and Sominex sleep tablets. Glaxo, the U.K.’s biggest drugmaker, agreed to the cash deal to focus on “priority” brands.
The products garnered sales of about 134 million pounds ($210 million) last year, London-based Glaxo said in a statement today. The transaction will probably be completed in the first half of next year, according to the release.
Prestige rose as much as 20.5 percent and was up 20.4 percent at $11.23 at 10:39 a.m. in New York trading, the sharpest intraday gain since April 29, 2009.
Glaxo Chief Executive Officer Andrew Witty is working to expand the company’s business in oral health, wellness and nutrition, and plans to keep fast-growing brands such as Sensodyne toothpaste and Panadol pain reliever.
The net cash proceeds from the sale to Prestige, about 242 million pounds, “will be returned to shareholders during 2012,” Glaxo said.
The company will continue “the process of divestment” of the remaining brands for sale, which had revenue of about 400 million pounds last year, Glaxo said.
Today’s announcement is the seventh acquisition for Prestige since 2004. The last was the purchase of Dramamine anti-nausea medicine for $76 million completed in January.