RB.L Share News (RB)

* Mead Johnson gave Reckitt more new things

* Some see Pfizer consumer unit as stretch for Reckitt

* Mead Johnson performance has improved since purchase

By Martinne Geller

LONDON, March 10 (Reuters) - Reckitt Benckiser has noregrets about its $17 billion acquisition of Mead Johnson lastyear, its chief executive said, even though there are concernsit may now be too stretched to buy Pfizer's covetedconsumer health business.

The Pfizer business, which is currently on the block, wouldfulfil Reckitt CEO Rakesh Kapoor's long-stated plan to transformReckitt from a British maker of household cleaning products intoa global leader in consumer healthcare.

But some analysts question whether Reckitt has themanagerial and financial strength to pull off a deal that may beworth up to $20 billion so soon after buying the Mead Johnsonbaby formula business.

Kapoor declined to say whether Reckitt was bidding for thePfizer unit, which makes Centrum vitamins and Advil painkiller,or another smaller vitamin business being sold by Merck.

The CEO told Reuters that the Mead Johnson acquisition hadalready benefited Reckitt, although it has only just reversedseveral quarters of decline in that business.

"I can easily say that if I knew then what I know now, Iwould still have gone for Mead Johnson," Kapoor said.

"If you think about what Mead Johnson brings, it gives us amaterial platform in many emerging markets where we did not haveit, gives us a new category and was a catalyst to create RB2.0,"he said, referring to its new business structure operating astwo units, one focused on health and one on hygiene andhousehold goods.

GlaxoSmithKline is a potential rival bidder for thePfizer business. The CEOs of GSK and Reckitt have expressedinterest in the Pfizer sale, though neither company hasconfirmed its participation.

Liberum analysts estimated that Reckitt could afford to paymore than GSK while still adding to earnings, helped bypotentially selling off assets in the home and hygiene unit tofund the deal. But analysts at Jefferies have expressedscepticism about big divestitures, saying recently that buyingPfizer "adds up to leverage beyond the pale."

Even after selling a small food business to reduce leverage,Reckitt's net debt stood at about 3.5 times its earnings beforeinterest, tax, depreciation and amortisation (EBITDA) at the endof the year.

Pfizer's business would expand Reckitt's presence indeveloped markets in consumer health categories where it alreadyhas its own brands like MegaRed supplements and Nurofen tablets.

It would also give it a world-leading position in thestill-fragmented consumer health market, which is buoyed byaging demographics and greater awareness of health and wellness.

Mead Johnson took it into a new area of baby formula anddramatically boosted its presence in fast-growing markets likeChina.

"Mead Johnson is giving us something we didn't have," Kapoorsaid.

Reckitt has a track record of doing deals, dating from the1999 combination of Britain's Reckitt & Colman with Benckiser ofthe Netherlands. Yet its main focus is organic growth, as itworks its way back from weak performance last year, due to aseries of issues, from a cyber attack and a failed productlaunch to a market slowdown and a tax change in India.

The company's shares are down about 17 percent year-to-dateand 27 percent since closing Mead Johnson.

Based in the English town of Slough, Reckitt is alsopreparing for Britain's exit next year from the European Union.This includes considering whether it needs to build new producttesting facilities in the EU.

"With Brexit it is possible, unless the deal is negotiatedin a different way, that we will have to create some labs fortesting and quality control outside (Britain)," Kapoor said."That's something we're working on as a scenario."

"It's going to cost us more money if we have to and it isduplicating what we already do today. Do I like it? Of course Idon't ... but it's the kind of impact we have to work on."

He said it would cost "millions of pounds".(Reporting by Martinne Geller. Editing by Jane Merriman)