GlaxoSmithKline to sell its UK Horlicks brand

GSK share price Pharmco considers selling Horlicks in UK

GSK share price Pharmco considers selling Horlicks in UK

GSK has confirmed plans to sell its Horlicks business in the United Kingdom and close the site where the malted drink is made.

Shares in GSK rose 0.2% to £16.09. In the UK, Horlicks, which is more than 100 years old, is sold as a bedtime drink, but has largely fallen out of favour with British tastes.

GSK is also exploring options to divest some other smaller non-core nutrition brands. The combined annual United Kingdom sales of Horlicks and Maxi Nutrition amount to around GBP30.0 million.

The company confirmed on Wednesday that it planned to sell off its malt drink Horlicks brand in the United Kingdom and close the associated manufacturing site in Slough, while outsourcing some of the antibiotics manufacturing activity at its plant in Worthing.

These medicines are produced at GSK sites in Ulverston, Cumbria, Verona in Italy, and part of its Barnard Castle site.

However, the company explained that the sale of its Horlicks operations in Britain would not affect the brand in India or South East Asia, which now account for the "vast majority" of the brand's global revenue.

"Overall, GSK employs a total of around 17,000 people across the United Kingdom of which 5000 are in United Kingdom manufacturing operations".

"The proposals announced today for Worthing and Slough are subject to employee consultation, which will begin immediately", GSK added.

On Wednesday, GSK announced that it will invest more than £140m between now and 2020 across a number of sites in the United Kingdom, especially for the manufacture of respiratory and HIV medicines.

That is in addition to £275 million worth of investments announced past year, and the more than £1.2 billion that has been earmarked for United Kingdom manufacturing since 2012, GSK said.

The three sites to see investment are in Ware, Hertfordshire, Barnard Castle in County Durham, and Montrose in Scotland.

GSK committed to the ongoing manufacturing of other antibiotics such as Augmentin, as well as continuing to conduct research on new antibiotics.

It no longer plans to expand its facility in Ulverston.

"We are continuing to invest in science and our core businesses in the United Kingdom and we continue to see the United Kingdom as an attractive place for the life sciences industry".

"We have a substantial manufacturing presence in the United Kingdom and continue to support the network with new investment of more than £140 million in the next three years".

None of the decisions were due to the UK's decision to leave the European Union, said the company.

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