GlaxoSmithKline stock has fallen 3.96% in the year to date.
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GlaxoSmithKline expects to spin off its consumer healthcare venture with Pfizer in July 2022, in what will be Europe’s biggest demerger in 20 years.
Haleon, which makes brands including Sensodyne toothpaste and Panadol painkillers , expects to deliver annual organic sales growth between 4% and 6% in the medium term, with “sustainable moderate expansion” of adjusted operating margin, Glaxo (ticker: GSK) said Monday.
Haleon’s margin in 2022 will reflect synergies from the integration of Pfizer’s (PFE) portfolio of around £600 million ($804 million), which will offset £175 million to £200 million of new costs associated with running a stand-alone public limited company.
Subject to approval by Haleon’s board, the initial dividend is likely to be “at the lower end” of a 30% to 50% payout rate, Glaxo said.
Shares in Glaxo were down 1.34% in late-morning London trading. The stock has fallen 3.96% in the year to date. Pfizer shares were 0.84% lower in premarket.
Details of Haleon’s spinoff come after Glaxo disclosed in January that it had rejected three takeover bids for the business from Unilever (ULVR. London) late last year. The final offer was worth £50 billion, but Glaxo said it undervalued the business and its potential.
Glaxo CEO Emma Walmsley described the spinoff as an “important milestone” for the British drug company. “It comes ahead of what promises to be the most significant corporate change for GSK in the last 20 years, to create two new growth companies that will positively impact the health of billions of people,” she said.
Glaxo, which will focus on pharmaceuticals and vaccines following the demerger, will receive a dividend of more than £7 billion from Haleon and retain a 20% stake in the business. Pfizer will receive a dividend of more than £3 billion and will retain its 32% stake following the spinoff.
Write to Lina Saigol at [email protected]
