Andrew Witty, ceo of GSK, said following a “strategic review” of the brands the company had concluded that the “tremendous growth potential” of the brands, particularly outside core western markets could be “better leveraged by companies with existing category presence”.
As a result, the pharmaceuticals group has decided to pursue the divestment of the soft drink brands, subject to an appropriate valuation for GSK shareholders, Witty added.
Estimated £766M price
Speculation that GSK were planning to sell off the brands ̶ for an estimated £766M ̶ first rose in March as the most likely outcome of the strategic review.
The Lucozade and Ribena brands are said to contribute a large part of the company’s turnover, which was worth £1bn last year.
The plan was announced alongside GSK’s first quarter results which saw sales fall by 2%. The firm also posted core earnings per share of 26.9p and dividend of 18p.
GSK reiterated its 2013 expectations for sales growth of around 1% and core earnings per share growth of 3 ̶ 4%.