GSK increases exposure to India with $1B+ deal

|By:, SA News Editor

GlaxoSmithKline (GSK) intends to increase its holding in Indian subsidiary GlaxoSmithKline Pharmaceutical to up to 75% from 50.7% through an open offer in a deal worth $1.02B.

GSK said the "transaction will increase exposure to a strategically important market." The unit provides respiratory, cardiovascular and cancer drugs, antibiotics, and vaccines.

GSK is proposing to pay 3,100 rupees ($49.895) a share for GSK Pharmaceutical, 26% above the latter's closing price on Friday. The Indian firm will remain listed.

GSK intends to finance the transaction with its existing cash; the deal will be neutral to the U.K. company's earnings in the first year and be accretive after that.

The offer comes after GSK paid $901M in February to raise its holdings in another Indian unit, GlaxoSmithKline Consumer Healthcare, to 72.5% from 43.2%. (PR)