Haleon plans to sell its nicotine replacement therapy business outside the US to a unit of India's Dr. Reddy's for £500 million (€592.23 million), the British consumer healthcare company has said.
The divestment is expected to dilute Haleon's 2024 net revenue and adjusted operating profit by about 0.5% and about 1%, respectively. The company kept the rest of the forecast unchanged.
The business, which includes the Nicotinell brand of nicotine gum, lozenges and patches, generated revenue of £217 million (€257 million) last year.
Haleon, the maker of Sensodyne toothpaste, was created by a merger of GSK and Pfizer's consumer healthcare businesses in 2019 and spun off from GSK in 2022.
Earlier this year, Haleon also disposed off its popular ChapStick brand.
Focus On Growth
The latest divestment, expected to close in the fourth quarter, will allow Haleon to lower debt and focus on its growth areas such as non-prescription drugs, vitamins and oral care products.
Dr. Reddy's, one of India's largest generic drugmakers, draws a significant share of revenue from North America and Europe.
In May, the company noted that the consumer health sector would be one of its key focus areas for future investments as it looks to diversify its business operations.
Dr. Reddy's said in April it would form a joint venture with Nestlé India to make products such as supplements and nutraceuticals.
Brian McNamara, chief executive officer of Haleon commented, “The divestment of Haleon’s NRT business outside of the US is a further example of Haleon being proactive in managing its portfolio and is consistent with our strategy as we implement change to become more agile and competitive.
“Whilst this business has great brands, these are not core for us, but I'm sure they will continue to flourish given the focus and capability of Dr Reddy's.”
News by Reuters, additional reporting by ESM.
