UNITED KINGDOM – GSK’s consumer healthcare spinoff is set to launch on the London stock market on July 18 with a new name, a new CEO and around 10.3 billion pounds (US$12.3 billion) of debt.
That’s according to a report on This is Money, a U.K. finance website, which cites numbers from analysts at Barclays and Jefferies.
The standalone company, to be named Haleon, will market popular brands such as Sensodyne toothpaste and pain reliever Panadol.
Haleon also owns popular brands such as Sensodyne toothpaste and Robitussin cough syrup. The portfolio includes consumer health drugs from both Novartis and Pfizer as a result of deals from 2017 and 2019, respectively.
Sales last year totaled £9.54 billion, or around US$11.4 billion. This year, Barclays analysts expect sales to reach £10.67 billion (US$12.8 billion).
Haleon will have a “significant” debt load upon launch, or around four times its estimated earnings for this year, Barclays analysts wrote, according to the publication.
Jefferies analysts have touted the amount of debt notably high but said that the company’s largely unique asset base could benefit it.
The company is projected to reach a valuation between 38 billion pounds (US45.4 billion) to 45 billion pounds (US$53.8 billion) when its lists, This is Money reported.
Haleon will serve more than 100 markets globally and has an established presence in all key channels, according to GSK.
The demerger is a milestone in a strategy spearheaded by GSK boss Emma Walmsley, who is trying to refocus the Financial Times Stock Exchange 100 (FTSE 100) firm on its vaccine and drug development capabilities and boost its share price.
In addition, Haleon’s research and development network will consist of three centers employing 1,400 scientists.
Over the last three years, the unit has delivered more than 19,000 regulatory applications and approvals. Haleon expects to achieve organic sales growth in the 4% to 6% range in 2022.
GSK will retain up to 20% of its holding in Haleon. Last month, Pfizer announced that it plans on exiting its 32% stake in Haleon “in a disciplined manner” after the company lists — a complete turnaround from GSK’s previous announcements that said Pfizer would retain its 32% stake and appoint two board members.
According to a quarterly filing, Pfizer could get roughly US$15.8 billion from its stake.
Earlier this year, GSK booted multiple unsolicited offers from Unilever to buy the consumer health spinout for £50 billion (US$68 billion).
The GSK board decided that Unilever’s offers “fundamentally undervalued the Consumer Healthcare business and its future prospects.”
The demerger is a milestone in a strategy spearheaded by GSK boss Emma Walmsley, who is trying to refocus the Financial Times Stock Exchange 100 (FTSE 100) firm on its vaccine and drug development capabilities and boost its share price.
The company’s name is a mashup of the words “hale,” meaning “in good health,” and “leon,” which is associated with strength.
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