HUL-GSK Consumer Healthcare merger completed

The merger has been on the basis of an exchange ratio of 4.39 HUL shares for each GlaxoSmithKline Consumer Healthcare share.

The approvals have now been secured. In addition, the board of directors of HUL have approved HUL acquiring the Horlicks brand for India from GSK for a consideration of Euro 375.6 mln (INR 3045 Cr). This was an option available in the original agreement made between Unilever and GSK. The other brands which were under the ownership of GSKCH like Boost, Maltova and Viva come to HUL’s brand portfolio by virtue of the merger.  

HUL’s strategy to build a sustainable and profitable Foods and Refreshment (F&R) business in India is accelerated by this deal. Horlicks, with a volume share of close to 50 per cent, was introduced to India in the 1930s. Through a statement GSK reinstated that India remains an important growth market. The company is committed to investing in both its listed pharmaceuticals business and its OTC and Oral Health brands in this country. As part of the transaction, HUL will distribute consumer healthcare brands, which include Sensodyne, Crocin, Otrivin and Eno, for GSK in India. GSK will continue to be responsible for demand generation, portfolio strategy, R&D and marketing for these brands.  

Brian McNamara, CEO, GSK Consumer Healthcare, said:  “The close of this transaction signals the beginning of an exciting new chapter for GSK in India, enabling us to focus and build on our portfolio of brilliant, science-based OTC and oral health brands and to make these products available to more consumers across the country.”   

Sanjiv Mehta, chairman and managing director, Hindustan Unilever, said, “Brands such as Horlicks and Boost are iconic, and we are excited to have them in the Hindustan Unilever fold. The merger gives us a unique opportunity to live our purpose and serve India where nutrition related challenges form the largest causes of disease– malnutrition and micronutrient deficiency - and aligns well with the government’s ambitious Swasth Bharat and Poshan Abhiyan programs. I am delighted to welcome the 3,500 – strong nutrition team to the HUL family. Both organisations have common values coming from a lineage of respected parent companies and a shared heritage of building iconic trusted brands."  

He added, "In the current context, the focus of the company has been to ensure that all our people remain safe and we do our best to keep supply lines running for essential products. In these difficult times, we are joining hands with the government in the fight against COVID 19’’  

About the deal:  
GlaxoSmithKline Consumer Healthcare's business delivered a total turnover of around Rs 45 billion in the year ended March 2019, primarily through its Horlicks and Boost brands. The merger of GlaxoSmithKline Consumer Healthcare with HUL has been on the basis of an exchange ratio of 4.39 HUL shares for each GlaxoSmithKline Consumer Healthcare share. Following the issue of new HUL shares, Unilever‘s holding in HUL will be diluted from 67.2 per cent to 61.9 per cent.

This article was first publsihed by Campaign India.