GSK unloads the last of its Aspen stake with $620M sale

GlaxoSmithKline CFO Simon Dingemans

Over 7 years, GlaxoSmithKline’s ($GSK) investment in Aspen Pharmacare grew in value sixfold. But that run has come to an end, as GSK wrapped up its final stake sale in the South African company Thursday, raising about $620 million.

London-based Glaxo will use the proceeds “for general corporate purposes,” according to a statement GSK issued. All told, GSK sold 28 million shares--a 6.2% stake--to institutional investors at a 5% discount.

The exit follows a similar move last March by GSK to raise $890 million by selling some Aspen shares. In 2013, the company sold one-third of its Aspen stake for $741 million. GSK has also been selling product rights to the South African drugmaker; just this month, the company handed over some anesthetic meds to Aspen for $370 million.

“GSK has had a long and successful partnership with Aspen and our investment in the company has grown in value significantly over time,” CFO Simon Dingemans said in the statement. “This disposal completes a successful phased approach to realizing that value which we can now deploy behind the Group’s priorities.”

Aspen shares have lost about 20% of their value since GSK last sold shares.

But the relationship between the companies won’t come to a close, Aspen CEO Stephen Saad said in a statement. David Redfern, GSK’s chief strategy officer, will stay on Aspen's board of directors.

The sale comes in the same month GSK agreed to sell some anesthetic meds to Aspen for $370 million.

Back in 2013, in a larger deal, GSK offloaded thrombosis brands Arixtra and Fraxiparine, plus a manufacturing facility in France, to the South African company for $1.1 billion. That came at about the same time Aspen agreed to buy 11 Merck ($MRK) products, plus API plants in the U.S. and the Netherlands, for $1 billion.

GSK joins a host of pharma companies seeking to slim down and focus on growth areas by selling non-core assets. Crosstown rival AstraZeneca ($AZN) has been very active with the tactic this year, selling rights to meds in certain countries to raise some cash, and last month it offloaded a portfolio of antibiotics to Pfizer ($PFE) for $1.5 billion.

For its part, GSK embarked on a major strategy shift in 2014 by deciding to sell its oncology assets to Novartis ($NVS) in exchange for the Swiss pharma’s vaccines. Last year, the company deciding against spinning off its ViiV Healthcare HIV drug business as pharma revenues lagged.

Related Articles:
AstraZeneca gins up $520M-plus selling anesthetics rights to Aspen
Pfizer grabs AZ antibiotics in $1.5B deal. Pre-split prep or just another sales-boosting buy?
Glaxo to reap $890M as it halves stake in South Africa's Aspen
Embattled GSK scraps ViiV spinoff as pharma revenues tumble
Slimdown craze still on, with sales and spinoffs galore. Slim fast? Not necessarily
GSK cashing in one-third of its stake in South Africa's Aspen
Transfer of GSK plant to Aspen Pharmacare will wait until midyear