Pfizer is divesting a portion of its stake in the consumer-healthcare business Haleon, raising approximately $3.5 billion through the sale. The pharmaceutical giant is reducing its shareholding in Haleon from 32% to 22.6% through an off-market share buyback and the sale of 790.6 million shares in Haleon.
The sale includes 594 million ordinary shares in Haleon, priced at 308 pence per share, representing a discount of approximately 4% to Friday’s closing price. This sale amounts to around £1.83 billion ($2.33 billion). Additionally, Pfizer is selling 98.3 million American depositary shares (ADS), with each ADS representing two ordinary shares, priced at $7.85 each, totaling around $771 million.
Haleon was created in July 2019 through the merger of drugmaker GSK and Pfizer’s consumer-healthcare businesses, forming a new joint-venture company. It was subsequently spun out and listed on the London Stock Exchange in July 2022. Pfizer, which initially retained a 32% ownership in the group, stated during the demerger that it intended to exit its interest to maximize value for its shareholders.
This divestment marks Pfizer’s first reduction in its stake in Haleon. Haleon is known for products such as Sensodyne toothpaste, Aquafresh mouthwash, Panadol, and Advil. GSK has also been reducing its initial 12.9% shareholding and now holds a 4.2% stake in the company.
In a period marked by significant merger-and-acquisition activity in the pharmaceutical industry, Pfizer’s move to sell part of its stake in consumer-healthcare business Haleon reflects ongoing trends. Pfizer recently completed its $43 billion acquisition of biotech cancer-specialist Seagen in December, contributing to a broader wave of multi-billion dollar deals involving companies like GSK, AstraZeneca, AbbVie, and Novartis.
In addition to the sale of shares, Haleon has agreed to repurchase 102.3 million of its own ordinary shares from Pfizer at the same price per share as Pfizer’s offer, amounting to approximately £315 million or $400.9 million.
Initially, Haleon had announced that Pfizer would sell 630 million of its shares, a move that, combined with the share buyback, would have reduced Pfizer’s stake to 24%.
It’s important to note that Haleon’s closing price on Friday was 322.3 pence, approximately 4% higher than the price offered by Pfizer for Haleon’s ordinary shares. Additionally, Pfizer is selling 98.3 million American depositary shares (ADS), each representing two ordinary shares in Haleon, for around $771 million.
A previous version of this article incorrectly stated that the company was raising around $4.27 billion and misstated other figures.