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Home / Business / Pfizer and GlaxoSmithKline announce Joint Venture to create a worldwide global consumer health

Pfizer and GlaxoSmithKline announce Joint Venture to create a worldwide global consumer health



NEW YORK – ( BUSINESS WIRE ) – Pfizer Inc. (NYSE: PFE) and GlaxoSmithKline plc (NYSE: GSK) today
announced that they have entered into an agreement to create a premier global
consumer health personnel with robust iconic brands. The boards in
The board of both companies has unanimously approved the transaction
under which Pfizer will contribute to its consumer health business
GlaxoSmithKline's existing consumer healthcare system. The 2017 global
Sales for the combined business were approximately $ 1

2.7 billion.

"We are pleased to announce this new joint venture for Pfizer Consumer
Health, deliver on our commitment to complete the strategic
Review for this business in 2018, says Ian Read, Chairman and Current
CEO, Pfizer. "Pfizer and GSK have an excellent track
record to create successful cooperation, and we look forward to
work together again to unlock the potential of our consumer
health care companies. "

According to the transaction, Pfizer will receive a 32% equity
shareholding in joint venture, which gives Pfizer its pro rata share of
the joint venture's earnings and dividends, which will be paid on one
quarterly. Pfizer has the right to appoint three out of
nine members of the joint venture board. The transaction is expected
to deliver 650 million dollars in top cost synergies and to be a bit
accretive for Pfizer in each of the first three years after the end of
The transaction, expected in the second half of 2019,
subject to receipt of GSK shareholder approval and government approvals,
and satisfaction of other usual closing conditions.

As Pfizer will own less than 50% of the joint venture, Pfizer
Expect deconsolidation of Pfizer Consumer Healthcare from its
accounts after completion of the transaction. IN
close to the medium term, this deconsolidation is not expected to have a
material impact on Pfizer's top line growth. In addition, given
Consumer health companies register lower margins than Pfizer's others
businesses, the deconsolidation is expected to have a slight positive development
affect Pfizer's operating margins over the next few years.

After integration of the combined business, GSK intends to
Separate the joint venture as an independent company through a divide of
its equity interest to its shareholders and a listing of the consumer
Health business in the UK stock market. GSK wants the sun
the right to decide if and when to start a termination and entry
for a period of five years from the closure of the proposed transaction. GSK
may also sell all or part of its joint venture in one
at the same time IPO.

Should a separation and entry occur within the first five years thereafter
concluding, Pfizer has the opportunity to participate through the distribution
of its ownership interest in the joint venture to its shareholders or
sale of equity interest in a simultaneous listing. After the fifth
The anniversary of the end of the proposed transaction, both GSK and
Pfizer will have the right to decide if and when to start one
segregation and public listing of joint venture.

"The combination of these leading companies with distinct regional and
The categories strengths will be more sustainable and wider than
either company individually, says Albert Bourla, Chief Operating
Officer and incoming CEO, Pfizer. "We believe that
This joint venture is a great opportunity to ensure future success
by Pfizer Consumer Healthcare, while unlocking meaningful value after tax
for Pfizer shareholders. "

The joint venture will be a leader in pain relief, respiratory tract,
vitamin and mineral supplements, digestive hygiene, skin health and
therapeutic oral health and will be the largest global consumer
health care business. In addition, joint ventures are expected to be
The first or second largest consumer health service in the key
Geographic Countries, including USA, Europe, China, India and
Australasia. The cooperation will operate globally under GSK
Consumer Health Care Name.

"The transaction is a testament to the consumer's success
The health service's business, including its good reputation, talented
colleagues, high quality products and market reach, "says Chris Slager,
President, Pfizer Consumer Healthcare. "Devotion and hard work of
The Pfizer Consumer Healthcare team is impressive and inspiring. I am
proud of our colleagues all over the world who are passionate about
the success of this business and the important role it plays to provide
Consumers should take health and well-being in their own hands. "

Emma Walmsley, GSK CEO, will be the head of the new joint venture. Brian
McNamara, currently CEO of GSK Consumer Healthcare, becomes the Managing Director of the new
joint venture and Tobias Hestler, currently CFO GSK Consumer Healthcare,
will be the CFO.

Until separation, the collaboration will be consolidated in GSKs
accounting.

For the year ended December 31, 2017, Pfizer Consumer Healthcare
Company revenue of about $ 3.5 billion and GSK
The Consumer Health Business recorded revenue of around $ 9.2
billion.

GSK has agreed to pay a 900 million dollar break if (i) the GSK Board
Board members change, withdraw or qualify their recommendation of
transaction to shareholders for approval (ii) GSK shareholders
vote on the proposed transaction and do not approve it or (iii) GSKs
Shareholders do not accept the proposed transaction by 30 September,
2019 (subject to renewal under certain circumstances).

Centerview Partners LLC, Guggenheim Securities, LLC and Morgan Stanley &
Co. LLC served as Pfizer's financial advisors, Wachtell, Lipton, Rosen &
Katz and Clifford Chance LLP served as legal advisors, and Damage,
Arps, Slate, Meagher & Flom LLP served as tax adviser.

INFORMATION MESSAGE : The information in this
The release is from December 19, 2018. Pfizer assumes no obligation
Update forward-looking statements in this issue as
Results of new information or future events or developments.

This release contains forward-looking information related to Pfizer,
Pfizer and GSK's consumer health company and an agreement on
Create a joint venture to combine Pfizer and GSK's consumer health
Companies that involve significant risks and uncertainties as may
cause actual results to differ materially from those expressed or
Underlined by such statements. Prospective statements in this issue
include, among other things, statements about the potential benefits of
the proposed joint venture and transaction, expected growth and
cost savings, companies' plans, goals, expectations and
intentions, financial conditions, operating profit and business
of the proposed joint venture, the proposed joint venture's products and
potentially, the expected effect of the decon consolidation of Pfizer
Consumer Healthcare business from Pfizer's annual accounts, GSKs
future plans to separate the joint venture as an independent company,
and expected time of completion of the transaction. Risk and
Uncertainties include risk related to
Satisfaction with the terms of closing the transaction (including
failure to obtain necessary approvals from regulatory and GSK shareholders) i
the expected time frame or at all and the ability to
The transaction does not close Risk associated with the ability to realize
Expected benefits of the transaction, including the ability to
the expected benefits and cost savings from the proposed transaction
will not be realized or will not be realized within the expected time
period; the risk that the companies will not be integrated
successful; the possibility of a future separation of the joint
venture can not occur; Interruptions from the transaction do more
difficult to maintain business and operating conditions negative
effects of the announcement or implementation of the proposed
transaction on the market price of Pfizer's stock market and on Pfizer's
operating profit; significant transaction costs; unknown debt;
the risk of litigation and / or regulatory measures related to the proposed
transaction; Other business effects, including the impact of industry,
Market, Economic, Political or Regulatory Relationships; future exchange
and interest rates; changes in taxes and other laws, regulations, prices
and politics; future business combinations or disposals and competitive
the development.

A further description of risk and uncertainty can be found in
Pfizer's Annual Report on Form 10-K for the fiscal year ended December
31, 2017 and in subsequent reports on Form 10-Q, included in
parts thereof with the title "Risk Factors" and "Forward-Looking."
Information and factors that can affect future results, "as well as in
its subsequent reports on Form 8-K, all of which are filed with U.S.
Securities and Exchange Commission and available at
www.sec.gov and www.pfizer.com .

Revenue from GSK's consumer health business is included in this
The release was provided by GSK Consumer Healthcare management and
Converted from sterling to US dollars at an exchange rate of
1.30.


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