Bankers prepare £25bn package as private equity firms circle GSK
Bankers are putting together major financing packages in preparation of a potential private equity bid for GlaxoSmithKline’s consumer healthcare business, according to reports.
Lenders are reportedly modelling debt packages of between £20bn and £25bn in sterling, dollars and euro, according to Bloomberg, after it emerged that GSK had rebuffed three cash-and-share approaches from Marmite-maker Unilever last year.
Unilever’s offers have fuelled speculation of a bidding war as both private equity firms and consumer good groups reportedly circle the business.
Russ Mould, investment director at AJ Bell, said: “GlaxoSmithKline’s share price has jumped on the news as Unilever’s actions effectively fire the starting gun for a bid war for the consumer goods unit. Nestle could be interested, so too private equity.”
Analysts have said that Unilever’s offer has put GSK’s consumer group in the shop window and a number of other consumer firms will be sizing up the business as a potential fit.
However Unilever has reportedly held talks with bankers today to discuss additional financing and is said to be shaping up another bid.
Boss Alan Jope defended the approach today and announced plans to grow its health, beauty and hygiene business and sell slower-growing products, as it looked to slow an investor exodus.
The FTSE 100 firm saw its share price slide nearly 7% at points today.