Unilever acquires 82% stake of GSK Bangladesh

Unilever Overseas Holdings BV has become the new owner of GlaxoSmithKline (GSK) Bangladesh Ltd by completing the acquisition of 82 percent shares in the pharmaceutical giant. 

According to the Dhaka Stock Exchange (DSE), Unilever bought 98.75 lakh shares from Setfirst Ltd, a sister concern of GSK, through the block market on Sunday.

Unilever bought each share of GSK at Tk2,046.3 and the total value of the transaction stood at Tk2,020.75 crore, which is the highest trade value of an individual company in the history of DSE. 

Therefore, owing to this block transaction, the daily turnover at the premiere bourse amounted to Tk2,543.25 crore — the highest in the last nine years. 

On the main trading floor at the DSE, the share price of GSK surged by 3.11 percent to Tk2,110 per share on Sunday, which was Tk2,046 per share in the previous session. The closing price of the company stood at Tk2,084.1 per share.

GSK Bangladesh – a subsidiary of the British pharmaceutical giant GlaxoSmithKline plc – got listed on the Dhaka Stock Exchange in 1976. 

On December 3, 2018, Unilever NV declared that it would buy GSK shares. 

The GSK headquarters in late 2018 entered into a contract with another European multinational Unilever to sell its health food and drinks business worldwide. 

Following the global deal, the two groups in India have recently amalgamated their concerned companies.  

But in Bangladesh, they preferred a mother company of Unilever to buy out majority shares of GSK Bangladesh from GSK headquarters.

An official of GSK seeking anonymity said, "After the change of ownership, the board of GSK will be reshuffled soon. But the company's management will not be reshuffled under the new board."

GSK shuttered its 60-year-old pharmaceuticals business in Bangladesh in 2018 as the pharmaceuticals unit, based in Chattogram, was facing losses. 

Hence, to prevent any more losses, the company's board decided to bring down the curtains on the business.

After shutting down the pharmaceuticals business, GSK made a profit of Tk98.57 crore in the last financial year. It also recommended a 530 percent cash dividend to its shareholders.

At present, Horlicks contributes to around 93 percent of GSK Bangladesh's annual sales. The rest comes from mainly Sensodyne toothpaste, though there are some minor products like over the counter antacid brand Eno.

Meanwhile, in the first quarter of the current financial year the net income of the company has increased by 35.44 percent to Tk18.04 crore. During the period, its earnings per share were Tk14.97.

The paid up capital of GSK is Tk12.04 crore. 

Out of total shares, the sponsors and directors hold 81.98 percent, institutional investors hold 15.53 percent, foreign investors hold 0.37 percent and the general investors hold 2.12 percent shares of the company.