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Aspen Falls Most in Five Months After Glaxo Reduces Stake

Aspen Pharmacare Holdings Ltd., Africa’s largest generic-drugs maker, fell the most in four months after GlaxoSmithKline Plc cut its stake in the company at a discount to the share price.

Aspen shares slumped 3.9 percent to 257.00 rand by the 5 p.m. close in Johannesburg, the most since July 18. About 63 million shares changed hands, or more than 70 times the three-month daily average.

Glaxo, based in London, has agreed to sell 28.2 million Aspen shares at 250 rand each, raising more than 7 billion rand ($694 million), the company said in a statement today. The price is about 6.5 percent below Aspen’s shares at the close of trading yesterday in Johannesburg.

“Aspen’s shares have risen well, so Glaxo has made fairly good money,” Mila Mafanya, a fund manager at Afena Capital in Cape Town, said by phone. “This doesn’t seem to indicate a change in relationship between them, rather it’s probably a good time to take the profit.”

Glaxo’s stake in Aspen will be reduced to about 12 percent, the U.K. company said. It will retain its board seat and intends to remain a significant shareholder. Aspen said on Sept. 30 it would buy Glaxo’s injectable thrombosis brands, manufacturing site, and inventory for 700 million pounds.

Aspen shares have climbed 52 percent this year, raising its price to 33 times earnings. The benchmark FTSE/JSE Africa All Share Index has gained 15 percent and trades at 20 times.

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