Hindustan Unilever will take over GlaxoSmithKline’s Indian healthcare business, including malted drinks Horlicks and Boost. Following a $3.8 billion (₹31,700 crore) all-equity deal, the biggest-ever in India’s consumer goods segment, Hindustan Unilever will become the country’s largest food company, ahead of rivals Nestlé, Britannia and ITC. The transaction will give GlaxoSmithKline around 5.7% stake in HUL while Unilever’s holding in its India unit will drop by 5.3% to 61.9%. HUL will also sell GSK Consumer's popular over-the-counter products such as Crocin, Eno, Iodex and Sensodyne as part of a five-year distribution agreement.
The market for health food drinks in India is estimated at ₹7,000 crore, according to HUL, with Horlicks accounting for around 60% of volume.
The merger is subject to approvals from statutory authorities and shareholders.
This transaction values GSK Consumer at ₹31,700 crore. HUL will issue 4.39 of its own shares for every share of GSK Consumer. Following the issue of new HUL shares, Unilever’s holding in HUL would drop from 67.2% to 61.9%, the company said.
HUL will also market and distribute some brands of GSK Healthcare such as Sensodyne, Otrivin, Crocin and Eno.