Aspen buys GSK brands
Fin24 - Apr 23rd 2012, 14:01
London - GlaxoSmithKline has agreed to sell a clutch of international over-the-counter healthcare brands for Â£164m to South Africaâ€™s Aspen Pharmacare Holdings [JSE:APN], Britainâ€™s biggest drugmaker said on Friday.
Cash proceeds from the transaction are expected to be about Â£135m and will be returned to shareholders during 2012.
The sale is the latest move by GSK to fine-tune its consumer healthcare business and follows the divestment of other over-the-counter brands in North America and Europe.
The brands being sold generated sales of around Â£60m in 2011. They include the painkiller Solpadeine and anti-stomach acid drug Zantac.
The net profit realised on the disposal in 2012 - after deducting transaction costs and a profit deferral of some Â£25m pre-tax because Aspen is a GSK associate - is expected to be Â£105m before tax, or Â£90m after tax.
GSK added it continued to plan to sell its OTC weight-loss pill Alli. This process has been delayed due to supply problems at a Roche factory in the United States.
The Swiss company manufactures the active ingredient, orlistat, which is also the active substance in Rocheâ€™s prescription-only drug Xenical. Alli is a low-dose version of Xenical.
GSK first announced in February 2011 that it planned to dispose of non-core brands sold primarily in North America and Europe and representing about 10% of its consumer health portfolio, in order to focus on priority brands and emerging markets.
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