Glaxosmithkline is selling its iconic malt drink Horlicks to help fund a £9.2billion buyout of its joint-venture partner’s healthcare arm.
It has teamed up with Swiss firm Novartis for the past three years to produce cold remedies and Sensodyne toothpaste.
But now GSK is to take over Novartis’s stake, buying the 36.5 per cent of the partnership it does not already own for £9.2billion.
Glaxosmithkline is selling its iconic malt drink Horlicks to help fund a £9.2billion buyout of its joint-venture partner’s healthcare arm
But it has also pledged to review the company’s healthcare nutrition arm – which makes most of its money from sales of 145-year-old drinks brand Horlicks in India – with a view to selling it.
In India, Horlicks is popular with sporty children, as it is seen as good for fitness.
Glaxo no longer owns the UK brand for Horlicks, after selling it to Aimia Foods in 2017 and closing a plant in Slough where it was made.
Bedtime favourite: Horlicks
- Horlicks was invented in Chicago in 1873 by two British businessmen
- It was popular on early voyages to the North and South poles – and even has an Antarctic mountain range named after it ÷ Horlicks tablets were sold as sweets to British and US soldiers in the Second World War
- All athletes were given the powder in the 1948 London Olympics ÷ At its height, the firm’s Slough factory produced 15,000 tons of Horlicks a year
But it still has a 72.5 per cent stake in the Indian business which produces Horlicks, and this is the key business it is now considering selling.
The Novartis deal is part of a wider push by Glaxo to simplify its business so it can focus on research in the cut-throat pharmaceuticals market.
Last week, the British firm pulled out of a race to buy assets from Pfizer to focus on this tie-up.
GSK chief executive Emma Walmsley said: ‘We believe the consumer healthcare business is well-positioned to deliver future sales growth and continued operating margin improvements.’
Shares in Glaxo rose 4.9 per cent, or 67.8p, to 1351p on news of the deal.