Unilever is to buy GlaxoSmithKline's&nbsp;Horlicks&nbsp;nutrition business for $3.8 billion, boosting the Anglo-Dutch group's position in India by adding the popular malted drink.

The deal, announced on Monday, increases the consumer goods giant's reach in one of the world's fastest-growing economies and marks a notable addition to the portfolio by outgoing Chief Executive Paul Polman, who steps down in January.

Even though many of <a href="http://www.wionews.com/business-economy/kraft-heinz-withdraws-143-billion-unilever-bid-12574">Unilever's recent acquisitions</a> have focused on beauty and personal care products, buying&nbsp;Horlicks&nbsp;is a rare opportunity for Unilever to increase its scale in India, particularly in food and drinks.

For GSK boss Emma Walmsley, it is a chance to further streamline operations and generate cash for increased investment in pharmaceuticals. A few hours later, GSK announced it had agreed to buy US&nbsp;cancer drug specialist Tesaro for $5.1 billion, marking a major biotech investment by the drugmaker.

The&nbsp;Horlicks&nbsp;deal follows a competitive auction in which Unilever saw off rival Nestle, as well as earlier interest from Coca-Cola.

The transaction covers GSK's health food and drinks portfolio in India, Bangladesh and 20 other predominantly Asian markets. The business has annual sales of around 550 million euros, primarily through the malt-based&nbsp;Horlicks&nbsp;and Boost brands.

Horlicks&nbsp;comfortably dominates the health-drinks market in India and Unilever is expected to try to give it a fresh lease of life, following a slowdown in recent years as urban Indian consumers turn to healthier, less-sugary alternatives.

Bernstein analysts have said the business's growth slowed from 15 per cent to 4 per cent between 2013 and 2017, leading to lost market share, though management has indicated that performance has started to pick up in recent quarters.

Srinivas Phatak, finance head of Unilever's Indian unit, told reporters on Monday he expected the business to grow at a double-digit percentage rate in the medium term, boosting both earnings and profit margins. That would be well beyond Unilever's overall sales growth, this year forecast at the bottom end of a 3-5 per cent range.

"Growth has been a challenge in the recent periods," Liberum analyst Robert Waldschmidt said. "They're clearly expanding their emerging market footprint further and buying growth."

Unilever will seek to leverage its formidable distribution network to boost sales of&nbsp;Horlicks&nbsp;in smaller cities and rural areas.

The price is broadly in line with expectations. People familiar with the process had told Reuters it was likely to be sold for less than $4 billion.

Indian market

GSK's decision to sell the business follows its $13 billion acquisition of Novartis's stake in the two groups' consumer health joint venture this year. GSK said at the time that sellingHorlicks&nbsp;could support the funding of the Novartis buyout.

The main asset being sold is GSK's 72.5 per cent stake in Indian-listed GlaxoSmithKline Consumer Healthcare.

Unilever said its 3.3 billion euros ($3.75 billion) consideration would be paid in cash and shares in its subsidiary in India, Hindustan Unilever Limited (HUL).

Shares in both Indian companies rose more than 4 per cent on Monday, highlighting a "win-win" deal for both sides, according to Anand Shah, senior vice-president, consumer at Axis Capital.

"GSK's portfolio gives HUL a strong foothold in foods and beverages, space which it has been clearly lagging," he said.

It also gives the company greater access to India's middle-class parents who increasingly have more discretionary wealth and are willing to pay a premium for children's products.

But it may need to refresh&nbsp;Horlicks' traditional brand image and slogan, which promises that the drink makes children "Taller, Stronger, Sharper," marketing and brand experts said.

GSK said its net proceeds from the sale, after tax and hedging costs, were expected to be around 2.4 billion pounds ($3.1 billion).

Following the closure of the deal, which is expected in around 12 months, GSK will own approximately 5.7 per cent of HUL and the British drugmaker intends to sell this down in tranches.

As part of the agreement, HUL will also distribute GSK’s over-the-counter and oral health brands for an initial period of five years.

The deal comes a day before Unilever hosts a two-day investor event in Mumbai.

GSK was advised by Morgan Stanley and Greenhill, while BofA Merrill Lynch worked with Unilever.

Unilever is to buy GlaxoSmithKline's Horlicks nutrition business for $3.8 billion, boosting the Anglo-Dutch group's position in India by adding the popular malted drink.

Unilever is to buy GlaxoSmithKline's Horlicks nutrition business for $3.8 billion, boosting the Anglo-Dutch group's position in India by adding the popular malted drink. The deal, announced on Monday, increases the consumer goods giant's reach in one of the world's fastest-growing economies and marks a notable addition to the portfolio by outgoing Chief Executive Paul Polman, who steps down in January. Even though many of Unilever's recent acquisitions have focused on beauty and personal care products, buying Horlicks is a rare opportunity for Unilever to increase its scale in India, particularly in food and drinks. For GSK boss Emma Walmsley, it is a chance to further streamline operations and generate cash for increased investment in pharmaceuticals. A few hours later, GSK announced it had agreed to buy US cancer drug specialist Tesaro for $5.1 billion, marking a major biotech investment by the drugmaker. The Horlicks deal follows a competitive auction in which Unilever saw off rival Nestle, as well as earlier interest from Coca-Cola. The transaction covers GSK's health food and drinks portfolio in India, Bangladesh and 20 other predominantly Asian markets. The business has annual sales of around 550 million euros, primarily through the malt-based Horlicks and Boost brands. Horlicks comfortably dominates the health-drinks market in India and Unilever is expected to try to give it a fresh lease of life, following a slowdown in recent years as urban Indian consumers turn to healthier, less-sugary alternatives. Bernstein analysts have said the business's growth slowed from 15 per cent to 4 per cent between 2013 and 2017, leading to lost market share, though management has indicated that performance has started to pick up in recent quarters. Srinivas Phatak, finance head of Unilever's Indian unit, told reporters on Monday he expected the business to grow at a double-digit percentage rate in the medium term, boosting both earnings and profit margins. That would be well beyond Unilever's overall sales growth, this year forecast at the bottom end of a 3-5 per cent range. "Growth has been a challenge in the recent periods," Liberum analyst Robert Waldschmidt said. "They're clearly expanding their emerging market footprint further and buying growth." Unilever will seek to leverage its formidable distribution network to boost sales of Horlicks in smaller cities and rural areas. The price is broadly in line with expectations. People familiar with the process had told Reuters it was likely to be sold for less than $4 billion. Indian market GSK's decision to sell the business follows its $13 billion acquisition of Novartis's stake in the two groups' consumer health joint venture this year. GSK said at the time that sellingHorlicks could support the funding of the Novartis buyout. The main asset being sold is GSK's 72.5 per cent stake in Indian-listed GlaxoSmithKline Consumer Healthcare. Unilever said its 3.3 billion euros ($3.75 billion) consideration would be paid in cash and shares in its subsidiary in India, Hindustan Unilever Limited (HUL). Shares in both Indian companies rose more than 4 per cent on Monday, highlighting a "win-win" deal for both sides, according to Anand Shah, senior vice-president, consumer at Axis Capital. "GSK's portfolio gives HUL a strong foothold in foods and beverages, space which it has been clearly lagging," he said. It also gives the company greater access to India's middle-class parents who increasingly have more discretionary wealth and are willing to pay a premium for children's products. But it may need to refresh Horlicks' traditional brand image and slogan, which promises that the drink makes children "Taller, Stronger, Sharper," marketing and brand experts said. GSK said its net proceeds from the sale, after tax and hedging costs, were expected to be around 2.4 billion pounds ($3.1 billion). Following the closure of the deal, which is expected in around 12 months, GSK will own approximately 5.7 per cent of HUL and the British drugmaker intends to sell this down in tranches. As part of the agreement, HUL will also distribute GSK’s over-the-counter and oral health brands for an initial period of five years. The deal comes a day before Unilever hosts a two-day investor event in Mumbai. GSK was advised by Morgan Stanley and Greenhill, while BofA Merrill Lynch worked with Unilever.

Unilever to buy GSK's Horlicks India business in $3.8 billion deal

Stocks rose on Monday after a truce in trade relations between the United States and China, while shares in Hindustan Unilever jumped after its deal involving GlaxoSmithKline's Horlicks nutrition business.

The broader NSE Nifty closed 0.06 per cent higher at 10,883.75, while the benchmark Sensex index ended 0.13 higher at 36,241. Both indexes marked their sixth successive session of gains.

Hindustan Unilever jumped 4.1 per cent to its best ever closing level after a deal announced by its Anglo-Dutch parent Unilever to buy GlaxoSmithKline`s Indian Horlicks business for $3.8 billion.

Meanwhile, shares in Sun Pharmaceutical Industries Ltd, India`s top drug manufacturer by market value, slid 7.6 per cent after a report of a regulatory probe against the company.

Stocks rose on Monday after a truce in trade relations between the United States and China, while shares in Hindustan Unilever jumped after its deal involving GlaxoSmithKline's Horlicks nutrition business.

Stocks rose on Monday after a truce in trade relations between the United States and China, while shares in Hindustan Unilever jumped after its deal involving GlaxoSmithKline's Horlicks nutrition business. The broader NSE Nifty closed 0.06 per cent higher at 10,883.75, while the benchmark Sensex index ended 0.13 higher at 36,241. Both indexes marked their sixth successive session of gains. Hindustan Unilever jumped 4.1 per cent to its best ever closing level after a deal announced by its Anglo-Dutch parent Unilever to buy GlaxoSmithKline`s Indian Horlicks business for $3.8 billion. Meanwhile, shares in Sun Pharmaceutical Industries Ltd, India`s top drug manufacturer by market value, slid 7.6 per cent after a report of a regulatory probe against the company.

Nifty, Sensex up for sixth day, Hindustan Unilever gets Horlicks boost

A group of public health experts have urged superstar Amitabh Bachchan to dissociate himself from promoting Horlicks, a multinational brand that has extended support to the Centre's recently launched National Nutrition Mission aimed at addressing the issue of undernutrition in the country.

The experts under the banner of the Nutrition Advocacy in Public Interest - India (NAPi) in a letter to the actor said, "Horlicks is a high sugar product, as 100 gram of a popularly advertised pack of Horlicks Delight, contains 78 gram of carbohydrates of which 32 grams is sucrose sugar".&nbsp;

"This is harmful for children as it may contribute to childhood obesity and non-communicable disease in later life," the experts said.

They said the WHO recommends a reduced daily intake of free sugars throughout the life course to less than 10 per cent of total energy intake.&nbsp;

Furthermore, in the interest of good health WHO suggests intake of free sugars to below 5 per cent of total energy intake, the letter stated.

The letter mentioned that in 2016, the World Health Assembly (WHA) adopted a Resolution 69.9 that recommends ending inappropriate promotion of foods for children from ages 6-36 months based on WHO and FAO dietary guidelines.&nbsp;

"Going by this recommendation promotion of Horlicks falls in category of inappropriate as they use false health claims in TV commercials," they said, adding that it dents Bachchan's image as a socially responsible celebrity.&nbsp;

"I fear that this campaign may have serious adverse repercussions: Horlicks is expensive and is likely to drain pockets of marginalized families under the misbelief that Horlicks is a good nutritious product for children as it is endorsed by Mr Bachchan. Thus Horlicks may displace healthy real family home foods and this way contravenes tackling the problem of undernutrition among children," said Dr Arti Maria, Head of Neonatology Department, RML hospital here.

Dr Aseem Malhotra, a renowned British cardiologist and author of?The Pioppi Diet? and former Director of Action on Sugar, UK, said high sugar foods/beverages should be prohibited for children as sugar has no nutritional value and that there is increasing evidence that added sugar increases the risk of developing type 2 diabetes, metabolic syndrome and fatty liver.

Claiming that the campaign was misleading and undermines optimal nutrition, the experts urged the actor to call off his association with Horlicks.

India's former health secretary Keshav Desiraju is the Chairman of Nutrition Advocacy in Public Interest - India (NAPi).&nbsp;

On&nbsp;March 8, on the occasion of International Women's Day, Prime Minister Narendra Modi had launched the National Nutrition Mission at Jhunjhunu in Rajasthan.

WHO recommends a reduced daily intake of free sugars throughout the life course to less than 10 per cent of total energy intake

A group of public health experts have urged superstar Amitabh Bachchan to dissociate himself from promoting Horlicks, a multinational brand that has extended support to the Centre's recently launched National Nutrition Mission aimed at addressing the issue of undernutrition in the country. The experts under the banner of the Nutrition Advocacy in Public Interest - India (NAPi) in a letter to the actor said, "Horlicks is a high sugar product, as 100 gram of a popularly advertised pack of Horlicks Delight, contains 78 gram of carbohydrates of which 32 grams is sucrose sugar". "This is harmful for children as it may contribute to childhood obesity and non-communicable disease in later life," the experts said. They said the WHO recommends a reduced daily intake of free sugars throughout the life course to less than 10 per cent of total energy intake. Furthermore, in the interest of good health WHO suggests intake of free sugars to below 5 per cent of total energy intake, the letter stated. The letter mentioned that in 2016, the World Health Assembly (WHA) adopted a Resolution 69.9 that recommends ending inappropriate promotion of foods for children from ages 6-36 months based on WHO and FAO dietary guidelines. "Going by this recommendation promotion of Horlicks falls in category of inappropriate as they use false health claims in TV commercials," they said, adding that it dents Bachchan's image as a socially responsible celebrity. "I fear that this campaign may have serious adverse repercussions: Horlicks is expensive and is likely to drain pockets of marginalized families under the misbelief that Horlicks is a good nutritious product for children as it is endorsed by Mr Bachchan. Thus Horlicks may displace healthy real family home foods and this way contravenes tackling the problem of undernutrition among children," said Dr Arti Maria, Head of Neonatology Department, RML hospital here. Dr Aseem Malhotra, a renowned British cardiologist and author of?The Pioppi Diet? and former Director of Action on Sugar, UK, said high sugar foods/beverages should be prohibited for children as sugar has no nutritional value and that there is increasing evidence that added sugar increases the risk of developing type 2 diabetes, metabolic syndrome and fatty liver. Claiming that the campaign was misleading and undermines optimal nutrition, the experts urged the actor to call off his association with Horlicks. India's former health secretary Keshav Desiraju is the Chairman of Nutrition Advocacy in Public Interest - India (NAPi). On March 8, on the occasion of International Women's Day, Prime Minister Narendra Modi had launched the National Nutrition Mission at Jhunjhunu in Rajasthan.

Experts urge Amitabh Bachchan to dissociate himself from 'Horlicks'

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