GSK planning to sell shares worth $3.45B in Hindustan Unilever

GlaxoSmithKline Plc (GSK) will begin selling its stake in Hindustan Unilever Ltd estimated to be worth almost ₹29,850 crore (between $3.5-3.7 billion), a person aware of the development told. GSK received the shares earlier this month in return for the sale of its Indian consumer business to Hindustan Unilever Ltd (HUL).
The two multinational giants had announced the all the share deal worth ₹31,700 crore (around $3.8 billion) in December 2018. In a statement on 1 April, GSK said HUL has paid it an extra ₹3,045 crore (approximately $400 million) to acquire the Horlicks brand for India, after seeking approval from the board of HUL. GSK Consumer Healthcare’s brands as like Horlicks, Boost and Maltova are now part of HUL’s food and refreshments business in the nutrition category. 3,500 GSK employees will also become part of the Indian arm of the Anglo Dutch giant Unilever. Under with the deal, HUL will distribute GSK’s brands such as – Eno, Crocin, Sensodyne, etc. in the country.


The person said, requesting anonymity as he is not authorized to speak to the reporters “GSK’s intention was to start selling its shares when the merger was consummated. They will sell the shares over a period of time. Investment banks JP Morgan, Morgan Stanley and others are advising GSK on this share sale”.
No final decision has been taken on this timing of the proposed sale, and Glaxo could decide to postpone the sale depending upon market conditions and investor demand. “GSK intends to monetise its holding in HUL at such time it considers appropriate, taking into account market conditions,” GSK told after the completion of the merger. GSK’s plan to sell the HUL shares comes at a time when FMCG major’s stock has been one of the outperformers in a market ravaged by the covid-19 pandemic situation.

 

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