GSK cuts landmark deal with Pfizer to combine consumer health units. GlaxoSmithKline (GSK) has agreed a landmark deal with US drugs giant Pfizer to merge their consumer healthcare units into what will become the world’s biggest seller of over-the-counter medications. The agreement represents the biggest shake-up of GSK since chief executive Emma Walmsley took over 18 months ago and is a cornerstone of her strategy to refocus the British pharmaceutical giant on those experimental drugs it deems will have the greatest chance of success and bring in the most money. Ms Walmsley’s plan paves the way for a break-up of GSK within three years as the venture will be spun out into an independent company with a separate listing on the London Stock Exchange.
Walmsley hopes focus on new drugs will give GlaxoSmithKline (GSK) a shot in the arm. In just 18 months Emma Walmsley has done to GSK what her predecessor Sir Andrew Witty spent much of his time trying to avoid: a break-up of the pharmaceutical giant. The decision to spin out the consumer healthcare division has been a long time coming and is a historic moment for GSK. Investors have been calling for a split for years. Despite this, the announcement will still have come as a surprise to many. When Walmsley was appointed Sir Andrew’s successor, the general consensus was it meant GSK’s structure would remain unchanged for the foreseeable future. After all, she was an insider, who had headed up the consumer health business to boot. Why would she want to shed a division she knew so well? She was also widely seen as a protégé of Sir Andrew, hand-picked to be his successor. This assessment now seems wide of the mark.
Spike in companies going bust boosts insolvency specialist Begbies Traynor Group (BEG). Britain’s top insolvency specialist expects corporate failures to continue rising next year as uncertainty around Brexit and woe on the high street take their toll. Begbies Traynor’s profits and revenues were up in the six months to October on the back of a 6% increase in corporate insolvencies in the prior year. Ric Traynor, executive chairman, said the rise was from a “very low base” after insolvencies fell to their lowest level in 2004. But he expects failures to keep growing in the coming months as uncertainty around Brexit and a drop in consumer confidence puts pressure on companies’ cash flows.
Royal Dutch Shell ‘B’ (RDSB) has made its second major solar power investment of the year by taking a stake in one of the largest solar power developers in South East Asia and India. The energy giant’s strategic investment in Cleantech Solar will drive the company’s efforts in building large-scale commercial and industrial solar projects. Shell will take a 49pc stake in the venture, with the option to extend its grasp on the company after 2021. Terms of the deal were not disclosed.
Santander, TSB and Clydesdale have joined ‘challenger’ banks on a shortlist of 11 institutions that qualify to join a £350m scheme to swipe Royal Bank of Scotland’s business customers. The incentivised switching scheme provides funding of up to £275m to SME customers of Royal Bank of Scotland Group (RBS) to switch their business current accounts and loans to challenger minnows. A further £75m has been set aside within RBS to cover certain customers’ switching costs. The programme was established under the terms of the RBS £45bn bailout during the financial crash, after it was directed by the Government and the European Commission to set up two funds worth a combined £775m. The other £425m Capability and Innovation Fund aims to help bidders develop their current account, lending and payments offerings for business customers.
