GSK lifts emerging market bet with full control of Indonesia arm
LONDON (Reuters) - GlaxoSmithKline is betting more on Indonesia by taking full control of its consumer healthcare unit in the country, underscoring a drive by the drugmaker to build up its presence in fast-growing emerging markets.
The move, announced on Friday, mirrors the British company's strategy in India, where it recently increased its stake in local units.
GSK has paid 465 billion rupiahs ($40 million) to Sarasvati Venture Capital for the 30 percent of the Indonesian consumer healthcare operation it did not previously own, giving it 100 percent of a business that sells non-prescription products like Panadol painkillers and Sensodyne toothpaste.
At the same time, GSK has sold its non-core local Insto eye drops brand to Pharma Healthcare and agreed to divest its factory at Bogor, Indonesia, to PT Pharma Healthcare for a combined total of 133 billion rupiahs.
"This transaction is a further example of GSK focusing its business in strategically important growth markets such as Indonesia. It will also simplify operations in the Indonesian business," David Redfern, GSK's chief strategy officer, said.
GSK's Indonesian consumer healthcare business has seen significant growth over the last five years, with net sales reaching close to 50 million pounds ($83 million) in 2013, up from around 16 million in 2008.
The company is committed to emerging markets as a key growth platform - based on rising demand for healthcare among growing middle class populations - despite recent problems in China, where sales have been hit by bribery allegations.
(Reporting by Ben Hirschler. Editing by Jane Merriman)