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(Alliance News) - Pfizer Inc will begin offloading its 32% stake in Haleon PLC as it focuses on reducing debt linked to its USD43 billion acquisition of Seagen Inc and boosting returns to shareholders, according to the Financial Times.
Pfizer is a New York-based pharmaceutical maker. Weybridge, Surrey-based Haleon is a consumer healthcare products firm that spun off from Brentford, west London-based pharmaceutical maker GSK PLC in July last year.
Pfizer Chief Financial Officer Dave Denton told the newspaper it will begin selling its interest within months, but in a "slow and methodical" manner". This is to prevent undermining Haleon's market valuation.
"We love the Haleon business but it's not strategic," Denton told the FT.
https://www.ft.com/content/ec441144-52ae-4fa2-8a04-4238db0ee504
Haleon was spun-off after GSK and Pfizer combined their consumer healthcare operations in 2019 before opting to list the joint-venture on the London Stock Exchange, and leaving GSK and Pfizer with a 13.5% and 32% stake respectively.
While Haleon shares have increased since the listing, valuing Pfizer's stake at just over GBP10 billion, its current market capitalisation remains significantly below Unilever PLC's GBP50 billion takeover offer in January 2022. This offer was rejected by GSK and Pfizer.
Haleon's market capitalisation was GBP31.45 billion in London on Wednesday late morning, with shares down 3.5% to 340.70 pence each, while GSK shares were up 0.6% to 1,463.95p each.
In New York, Pfizer shares were up 0.5% in pre-market trading on Wednesday, after closing down 0.4% to USD39.06 each on Tuesday. Its shares have dropped 24% since the start of the year.
Pfizer revealed its intention to dispose of its Haleon stake after revealing on Tuesday a sharp fall in first-quarter revenue due to falling sales of its Covid-19 vaccine.
Pfizer revenue in the first three months of 2023 fell by 29% to USD18.28 billion from USD25.66 billion a year earlier. Primary Care revenue plummeted by 37% to USD11.51 billion from USD18.85 billion.
Net income was down 30% to USD5.54 billion from USD7.86 billion. Diluted earnings per share fell by 29% to USD0.97 from USD1.37.
On Wednesday, Haleon said first quarter revenue grew by 14% to GBP2.99 billion, driven by "growth across all categories".
Haleon said operating profit in the first quarter was up 35% to GBP627 million, mostly thanks to separation and admission costs a year before, ahead of its listing in July 2022.
By Greg Rosenvinge, Alliance News reporter
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