GlaxoSmithKline is getting cozier with South Africa's Aspen Pharmacare Holdings. After linking up with Aspen in a marketing alliance last year, Glaxo is negotiating for a minority stake in the company--anywhere from 10 percent to 25 percent, according to press reports. At Aspen's market cap of $1.8 billion, the deal would be worth some $180 million to $450 million.
To effect the transaction, Glaxo would trade some assets for Aspen shares and would purchase additional stock either on the open market or from the company itself.
Aspen would be a two-birds-with-one-stone deal: As a generics maker, it would aid in Glaxo's diversification efforts. And as a drugmaker serving emerging markets such as Africa and Latin America, it would strengthen the U.K company's push into developing countries.
Glaxo Chief Andrew Witty has made emerging markets a centerpiece of his growth strategy. Already, he's inked deals to buy Bristol-Myers Squibb's Pakistani operations and Bristol's Egyptian drugs portfolio. And early this year, Glaxo bought UCB's product portfolio in parts of Africa, the Middle East, Asia and Latin America.