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GSK boosts stake in Aspen

Published on 12/05/09 at 04:45pm

GlaxoSmithKline has extended its stake in the South African generics company Aspen to a 16% shareholding.

In return it will transfer to Aspen a manufacturing facility and marketing rights to eight GSK products in South Africa.

Abbas Hussain, GSK president of emerging markets, said the deal supported GSK's strategy to accelerate sales growth in emerging markets.

He added: "The combination of our commercial activities in Sub-Saharan Africa is highly complementary and will mean that together we can provide more medicines of value to more patients in these countries. At the same time, GSK will also benefit from investing in one of Africa's leading healthcare companies with a formidable track record of delivery."

The deal builds on the existing relationship between the two companies that began last year, when GSK sold the rights to four products outside the US to Aspen, and acquired rights to Aspen's existing and pipeline products for use in emerging markets.

Under the new arrangement, GSK will divest to Aspen a manufacturing facility located in Bad Oldesloe, Germany, and the marketing and distribution rights to eight more medicines in South Africa, where Aspen has extensive commercial capability.

The products are Alkeran (excluding US), Kemadrin, Lanvis, Leukeran, Myleran, Purinethol, Septrin and Trandate. Combined sales of these products were £56 million in 2008.

GSK says the move is part of its strategy of simplifying operations and divesting certain products which can be more efficiently marketed by other parties. The companies are to collaborate in marketing the products together in the rest of Africa.

In completing the deal Aspen will issue 68.5 million new shares to GSK in exchange for the assets, equivalent to a 16% shareholding in the company. The agreement is subject to regulatory approvals and is expected to be completed before the end of 2009.

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