HE new consumer healthcare company to be spun out from GlaxoSmithKline will be named Haleon, it was announced today.
The standalone company is expected to generate annual revenues of approximately £10 billion, rising by between 4% and 6% per year, through sales of over-the-counter power brands including Sensodyne, Panadol and Nicorette.
With a mooted market valuation of around £60 billion, it will be eligible for entry on to the premium FTSE 100 index at the first opportunity following the demerger, expected in the middle of this year subject to shareholder vote.
GSK said the name was chosen from an initial list of more than 2000 suggestions and is a portmanteau of ‘hale’ – as in ‘hale and hearty’ – and Leon, a name which its brand consultants associate with ‘strength’. It will be used in more than 100 markets around the world.
Around 800 consumer health staff currently based at GSK’s landmark tower in Brentford will move to temporary offices in Weybridge, in south-west London’s commuter-belt, until 2024 while a £120 million corporate HQ is built.
Today’s announcement was hailed as another milestone in the four-year odyssey to carve the drugmaker’s empire into two separately listed companies.
Brian McNamara, Haleon’s CEO Designate, said: “Introducing Haleon to the world marks another step in our journey to become a new, standalone company.
“We are on track to launch Haleon in mid-2022 and our business momentum is strong. We look forward to updating investors and analysts more on this at our capital markets event at the end of February.”
The board will be led by chairman designate Sir Dave Lewis, the former boss of Tesco.
Glaxo turned down three approaches for the business from Unilever, which offered £50 billion in a final ill-fated tilt that provoked criticism from analysts and investors.
GSK’s chief Emma Walmsley said: “Haleon brings to life years of hard work by many outstanding people to build this new company purely dedicated to everyday health.
“Haleon has enormous potential to improve health and wellbeing across the world with strong prospects for growth, and through listing will unlock significant value for GSK shareholders.”
Walmsley intends to stay on as chief of the new vaccines and drugs discovery division, to be known as New GSK, despite public calls from activist investors Elliott and Bluebell to recruit a boss with a deeper scientific background.
Its 3500 employees will stay on at GSK House – overlooking the M4 – for at least two years and a search is under way for smaller offices nearby.
New GSK has set targets of 5% sales growth and 10% increase in profit by 2026, aiming for £33 billion in revenues by the end of the decade to offset the imminent loss of exclusivity over a cluster of blockbuster drugs including the £4.7 billion-a-year HIV inhibitor dolutegravir.