GSK splits off consumer health as Haleon – first stock listing today

Glaxo’s consumer healthcare business is currently a joint venture between GSK, which owns 68% and Pfizer (PFE), which has 32%. The demerger will take 80% of GSK’s holdings and will also establish a level-2 sponsored American depositary receipt (ADR) programme on the New York Stock Exchange (NTSE), which is a way for foreign companies to allow their shares to be traded on US exchanges.

Once the demerger has taken place, the total issued ordinary share capital of Haleon will mean that GSK shareholders will jointly own 54.5%, Pfizer will continue to hold 32%, GSK corporation will hold 6% and 7.5% will be held by Scottish limited partnerships, which provide funding to GSK pensions. Following Haleon’s initial public offering (IPO) and the lock-up period, Pfizer is then expected to reduce its stake in Haleon.

Behind Haleon, which most recently had annual sales of 9.5 billion pounds and profits of 1.6 billion pounds, are well-known brands such as Sensodyne toothpaste, Dr Best toothbrushes, Otriven rhinitis spray and Voltaren pain gel. Just six months ago, GSK rejected an offer from Unilever of 50 billion pounds (almost 60 billion euros) for the consumer goods division, now analysts calculate the IPO today worth between 33 to 48 billion pounds.

Update: Haleon had an unspectacular start on the stock market on Monday. After an initial price of 330 pence, which valued the company at around 30 billion pounds, the shares were last priced slightly lower at 316 pence. The GSK shares fell around 16% to reflect the spin-out. Future strategic aquisitions for GSK will be of great interest to watch, as the latest Sierra Oncology deal (USD1,9bn) may have given first hints.

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