GSK’s consumer healthcare arm Haleon will launch with £10bn of debt after splitting from the pharma giant
GlaxoSmithKline’s consumer healthcare arm will immediately be saddled with billions in debt when it spins off from the pharmaceutical giant later this month, the Daily Mail can reveal.
Haleon, which owns brands such as Sensodyne toothpaste and Panadol painkillers, will debut as a separate company on the London stock market on July 18 after a shareholder vote on the split tomorrow that is expected to be broadly approved.
But the company will start life with a large amount of debt weighing on its balance sheet, Barclays analysts say.
Milestone: GlaxoSmithKline boss Emma Walmsley tries to refocus the FTSE 100 company on its vaccine and drug development capabilities and boost its share price
The investment bank estimated that Haleon will have “significant” leverage of around £10.3 billion when it is listed as a separate company, around four times its estimated earnings for this year.
It was also flagged by analysts at brokerage Jefferies, who said the amount of debt was “unusually high” by stock market standards.
However, they went on to say that Haleon could benefit from its position as a “largely unique asset” in the London and global stock markets, which would provide it with “real scarcity value” that could drive the price higher. the action.
The city expects Haleon to fetch a valuation in the range of £38bn to £45bn when it goes on sale next month, although GSK previously rejected a £50bn offer. pounds for the company by consumer goods giant Unilever, saying it undervalued Haleon’s prospects.
Swiss giant Nestlé also considered making a bid earlier this year in what would have been its biggest deal ever, but backed out.
The split is an important step in a strategy led by GSK boss Emma Walmsley to try to refocus the FTSE 100 company on its vaccine and drug development capabilities and boost its share price.
GSK actions rose 1%, or 17p, to 1,802.6p.