GlaxoSmithKline, a British multinational pharmaceutical company, announced that it has sold its stake in Unilever’s Indian business for $3.35 billion.
The funds will help GSK in its goal of reinvigorating its drug development pipeline, having made costly bets on experimental cancer treatments and future cell and gene therapies amid sluggish revenue growth.
The 133.77 million shares were offloaded on average for 1,905 rupees, according to a statement from GlaxoSmithKline.
The deal, at $3.35 billion, eclipses the previous block trade record in India when Daiichi Sankyo sold its $3.18 billion stake in Sun Pharmaceuticals in April 2015, according to Refinitiv. On a global basis, the Glaxo block trade will be the 10th ever biggest, according to the data provider. The largest ever block trade remains Naspers selling $9.8 billion worth of Tencent stock in Hong Kong in March 2018.
There has been $6 billion worth of equity capital market deals in India so far in 2020, down from $8.52 billion during the same time last year, according to Refinitiv. The data showed the rate of activity in 2020 is the slowest since 2017.
GSK struck a deal in 2018 to fold its Indian business – whose main product is Horlicks – into Unilever’s Indian unit Hindustan Unilever in exchange for shares in the combined group. According to GSK’s first-quarter report, it completed the Horlicks deal on April 1, receiving 5.7% equity stake in Hindustan Unilever plus about 400 million pounds in cash.
Recently, GSK launched a two-year programme to split into two entities, separating the core prescription drugs and vaccines business from an enlarged over-the-counter products business that was merged with a Pfizer unit.
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