GSK gets Sebi nod for open offer to hike stake in Indian arm to 75%

Written by fe Bureau | Mumbai | Updated: Jan 16 2013, 07:53am hrs
GlaxoSmithKline Plc (GSK) has received the capital market regulator's approval for a voluntary open offer to increase its stake in its India-listed subsidiary, GlaxoSmithKline Consumer Healthcare. The offer will open on January 17 and close on January 30.

According to a release issued by the UK-based GSK, the open offer is intended to increase its direct and indirect stake in its publicly-listed consumer healthcare subsidiary in India from 43.2% to up to 75%. The open offer price has been fixed at R3,900, while the total offer will cost the parent company more than R5,200 crore.

Recent reports suggested that some of the institutional shareholders of the company were not keen on tendering their shares in the open offer. Shares of GlaxoSmithKline Consumer Healthcare lost marginal ground on Tuesday to close at R3,835.25 on the BSE.

According to the shareholding data of the company, Arisaig Partners Asia, LIC, GIC, HDFC Standard Life Insurance and Intrade all hold more than 1% stake in the Indian company that boasts of brands like Horlicks, Boost, Crocin, Eno and Iodex. Meanwhile, according to a stock exchange announcement, a committee of independent directors of the company has said the open offer price of R3,900 is fair and reasonable and in line with regulations laid down by Sebi.

Kotak Mahindra Capital Company acted as professional advisor to the IDC (independent directors' committee) and is of the view that the offer price of R3,900 per share is fair and reasonable, from a financial point of view, said the exchange announcement.

The open offer is being managed by HSBC Securities and Capital Markets (India). The open offer is being made by GlaxoSmithKline, along with Horlicks and GlaxoSmithKline plc in their capacity as persons acting in concert (PACs).