Unilever PLC has emerged as the leading bidder in a tight contest for GlaxoSmithKline PLC’s Indian Horlicks nutrition business, sources said.
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New Delhi:
The acquisition will strengthen Unilever’s position in India, an emerging market whose growing population and rising wealth make it attractive in the long term for companies trying to offset weak growth in Western markets. GSK’s assets, which include the popular malt-based drinks Horlicks and Boost, is likely to fetch less than $4 bn, said people close the deal, who declined to be identified.
Earlier in the sale process, sources told Reuters the assets could be valued at more than $4 bn. Some analysts considered the $4 bn valuation high considering the Indian market for so-called health drinks – mostly dietary supplements or flavour enhancers typically drunk with milk – is seeing a slowdown in growth.
Urban Indians are increasingly turning to healthier, less-sugary alternatives, analysts and industry sources said. Last month, Kraft Heinz Co agreed to sell its popular health-drink brands Complan and Glucon-D, along with a some other brands and factories to Zydus Wellness for Rs 45.95 bn.
If it is able to clinch the deal, Unilever will trump fellow European consumer giant Nestle SA, which as per reports was close to buying Horlicks and other GSK consumer healthcare assets in India. Unilever and GSK, which owns 72.5 percent of Indian business GlaxoSmithKline Consumer Healthcare Ltd, were in exclusive talks, it was reported on Tuesday.
The acquisition will strengthen Unilever’s position in India, an emerging market whose growing population and rising wealth make it attractive in the long term for companies trying to offset weak growth in Western markets. GSK’s assets, which include the popular malt-based drinks Horlicks and Boost, is likely to fetch less than $4 bn, said people close the deal, who declined to be identified.
Earlier in the sale process, sources told Reuters the assets could be valued at more than $4 bn. Some analysts considered the $4 bn valuation high considering the Indian market for so-called health drinks – mostly dietary supplements or flavour enhancers typically drunk with milk – is seeing a slowdown in growth.
Urban Indians are increasingly turning to healthier, less-sugary alternatives, analysts and industry sources said. Last month, Kraft Heinz Co agreed to sell its popular health-drink brands Complan and Glucon-D, along with a some other brands and factories to Zydus Wellness for Rs 45.95 bn.