GSK to raise stake in India unit in $ 939 m deal

Reuters: GlaxoSmithKline Plc plans to buy up to an additional 31.8% stake in its Indian consumer products arm GlaxoSmithKline Consumer Healthcare Ltd. for 52.2 billion rupees, sending shares of the Indian unit to a record high.

GlaxoSmithKline plans to raise its stake in GSK Consumer Healthcare to 75% from 43.2%, paying 3,900 rupees per share through an open offer, it said in a statement. The price represents a premium of 28% to the stock’s Friday close.

The offer period is expected to begin in January 2013.

“This transaction represents a further step in GSK’s strategy to invest in the world’s fastest growing markets and, we believe, offers a liquidity opportunity at an attractive premium for existing shareholders,” said David Redfern, Chief Strategy Officer at GlaxoSmithKline.

Shares in GSK Consumer Healthcare were locked at 3,659.20 rupees, up 20%, their maximum daily trading limit, while the Mumbai market was up 0.23%, by 9:17 a.m.

Securities regulations in India require a minimum public shareholding of 25% for a company to maintain a public listing.