Unilever has backed off its plan to buy GlaxoSmithKline’s consumer healthcare business, announcing it would not raise its rebuffed offer of US$68 billion (£50 billion).
After three rejected Unilever bids for the business, GSK will now continue with its original plan to spin the business off in a listing mid this year. The third rebuff came last weekend, as Inside FMCG reported on Monday.
In a statement, Unilever said that while it noted GSK’s assertion the offer “fundamentally undervalued” the business and its prospects that had not changed Unilever’s view of the target’s fundamental value.
“Accordingly, we will not increase our offer above £50 billion,” the statement said.
GSK’s consumer healthcare business includes Sensodyne toothpaste, Emergen-C vitamin supplement and the Panadol painkiller brands.
Pharmaceutical giant Pfizer holds a 32-per-cent stake in the consumer business. Earlier this week a source familiar with Pfizer’s strategy told Reuters that GSK and Pfizer would open negotiations with Unilever’s boss Alan Jope if the consumer goods giant was ready to improve its bid to more than £60 billion, a figure independent analysts consider a more realistic value of the business.