GSK may divest Horlicks business in India

GlaxoSmithKline (GSK) has initiated a strategic review of its dietary brand Horlicks, and other consumer healthcare nutrition products, to fund a proposed acquisition of Novartis’ stake in its Consumer Healthcare joint venture (JV) priced at $13bn.

According to the company, a majority of Horlicks sales are generated in India, where it is marketed by GSK Consumer Healthcare.

The firm also intends to enhance its focus on over-the-counter (OTC) and Oral Health brands such as Sensodyne and Eno, the total sales of which were reported to be around £550m last year.

A statement from GSK read: “GSK is initiating a strategic review of Horlicks and its other consumer healthcare nutrition products to support funding of the transaction, and to drive increased focus on OTC and Oral Health categories.”

GSK noted that the strategic review, which is scheduled to be completed by the end of this year, may not result in any deal.

If the company is to sell its Horlicks health nutrition business, food companies such as Nestlé, Kraft Heinz and Unilever may want to buy the business through their local Indian subsidiaries, according to Reuters reports. The business, which has a potential value of $4bn, could also attract the interests of Coca-Cola, PepsiCo, Suntory, Mondelēz and JAB.

Nestlé has also reportedly privately discussed its intentions with GSK to buy Horlicks on various prior occasions.

Horlicks is a brand of malted milk hot drinks available in India, the UK, Australia, New Zealand, Hong Kong, Bangladesh and Jamaica.