WSJ: “GlaxoSmithKline said Monday it plans to increase its stakes in its Indian and Nigerian units at a cost of more than $1 billion as the pharmaceuticals company targets consumers in fast-growing markets.
GSK, the U.K.’s largest drug maker by sales, plans to buy an additional 31.8% stake in GSK Consumer Healthcare Ltd. for approximately $940 million, taking its ownership in the Indian unit to a maximum 75% allowed under Indian ownership rules. The deal is in part a bet on Horlicks, a malted milk bedtime drink regarded as old-fashioned in the U.K. which is seeing rising sales in the former British colony.
Like many drug companies, GlaxoSmithKline is expanding its consumer health-care business as many of its best-selling prescription drugs lose protection from cheaper copies while also expanding into faster growing markets as its main U.S. and western European businesses face slowing sales. European sales fell 9% in the third quarter of 2012, largely due to price pressure from European governments.
At the same time, some consumer-goods companies are expanding into health-care products, a market buoyed by an aging population which continues to spend on vitamins and minerals to improve well-being. Reckitt Benckiser Group last week signed a $1.4 billion deal to acquire U.S. vitamin maker Schiff Nutrition International Inc., outbidding German pharmaceutical company Bayer .”
via GSK Invests in India, Nigeria – WSJ.com.
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