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Novartis India to sell OTC business to GSK Consumer for Rs 109 cr

Shares of the company went down by 0.45% to close at Rs 672.4 on BSE

BS Reporter Mumbai
Novartis will sell its Over-The-Counter Division (OTC Division) of Indian arm  to GlaxoSmithKline Consumer Private Limited, Indian entity of UK-based GlaxoSmithKline Ltd, under the agreement for business transferring between Novartis and GlaxoSmithKline signed last year. On Tuesday, the Board of Directors of Novartis India Ltd, has approved the transfer of its OTC Division to GlaxoSmithKline Consumer Private Limited.

"The Board approved on 13 January 2015 the transfer of the OTC Division as a going concern by way of a ‘slump sale’ to GSK CPL (affiliate of GSK) for a consideration of Rs 109.7 crore, on or before 22 October 2015, as well as closing of the global Joint Venture transaction between Novartis AG and GS," stated a company release.
 

As part of its global portfolio transformation, Novartis AG, agreed with GlaxoSmithKline plc, UK on 22 April 2014 to create a global consumer healthcare joint venture. In the joint venture, GSK will own 63.5% stake while Novartis would own the remaining 36.5% holding.

According to the company, sale of company’s OTC business in India follows the divestment of Novartis AG’s global OTC business, including all of Novartis AG’s major OTC patents, trade-marks and R&D assets. "The valuation for the transfer of the OTC Division, has been affirmed in a report provided by an independent valuer and has been confirmed in separate opinions from two leading merchant bankers," it said.
 
On Tuesday, shares of Novartis India went down by 0.45% to close at Rs 672.4 on BSE.

Last year, a multi-layered deal was signed between GlaxoSmithKline and Novartis, where GSK would acquire Swiss major's vaccine business for $7 billion, while the latter would purchase GSK's cancer drugs portfolio.

On December 12, Competition Commission of India had approved the deal, saying the deal will not have appreciable adverse effect on competition in India.

In India, GSK owns various subsidiaries such as Biddle Sawyer, GSK Asia, GSK Consumer Healthcare and GSK Pharmaceuticals. Novartis is present in India through Novartis India, Novartis Healthcare, Sandoz Private Ltd and Chiron-Behring Vaccine Private Ltd.



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First Published: Jan 13 2015 | 7:14 PM IST

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