GlaxoSmithKline (GSK) has announced it plans to sell its Horlicks brand of drinks in the UK as well as its MaxiNutrition business.
The move will see 320 jobs lost as the Horlicks manufacturing site in Slough is closed down. GSK has said it will also explore options to divest other smaller non-core nutrition brands.
The combined annual UK sales of Horlicks and Maxi Nutrition are around £30 million. GSK stressed that the decision does not impact the Horlicks brand in India or Southeast Asia, which accounts for the vast majority of Horlicks global revenues.
It is the first major move by GSK chief executive Emma Walmsley who took the helm at the UK pharmaceutical company four months ago. Presenting her first set of results in April, she said there were ‘tough choices’ to be made, and signalled that products not bringing in sufficient value for the company would be sold.
The announcement comes just a day after Reckitt Benckiser sold its food unit to McCormick in a deal worth $4.2 billion. The unit made $179 million in pre-tax profit in 2016, but RB performs much stronger in domestic products and personal care.
Similarly, GSK aims to shift its focus on its pharmaceuticals sector, which accounts for more than half – £16.1 billion – of its £27.8 billion annual sales.
Between now and 2020, the company plans to invest more than £140 million at production sites in the UK. The investments will support expansion of manufacturing for respiratory and HIV medicines.
This new investment is in addition to the £275 million announced last year and investment of over £1.2 billion in UK manufacturing since 2012.
Philip Thomson, president, global affairs, GSK, said: “We are continuing to invest in science and our core businesses in the UK and we continue to see the UK as an attractive place for the life sciences industry.
“We are working constructively with the government and others to develop an ambitious plan for the sector as part of the UK’s new industrial strategy.”
GSK, which employs a total of 17,000 people in the UK, said the announcements are unrelated to the UK’s decision to leave the EU.
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