NIGERIA – Glaxosmithkline Consumer Nigeria Plc has completed the divestment of its drinks bottling and distribution business to Suntory Beverage & Food Nigeria Limited (SBFN).
The company said the completion of the divestment followed approvals from the shareholders and the Nigeria Securities & Exchange Commission (SEC).
Following this approval, GSK has transferred ownership of the drinks business in Nigeria to SBFN effective October 1, 2016.
Consequently, GSK Consumer Healthcare Company (retained business) now consists of the consumer healthcare wellness, oral healthcare and nutrition categories and pharmaceutical business.
Suntory Beverage of Japan had in 2013 bought British drinks brands Lucozade and Ribena from GSK for 1.35 billion pounds ($2.1 billion at the time).
Since then, the company has outsourced production and sales of the drinks in Nigeria to GSK Nigeria.
The management of the company had said the divestment of its drinks bottling and distribution business would not affect its financial fortunes.
GSK Regional Head for Asia, Middle East & Africa, Mr. Zubair Ahmed had told THISDAY that the divestment was strategic.
“It is not a question of economic decision that the business was not making money. It did not fit into our global portfolio.
Nigeria was the only exception in the beverage market. Our focus globally is that GSK globally compete in five categories, which is pains, respiratory, skin, oral healthcare, and digestive.
These are the five categories that we compete globally. Nigeria was a bit of an aberration. What we have done has brought the portfolio synergized. We will not be getting into functional beverages. We stick to these categories for now,” he said.
According to Ahmed, the divestment was part of the company’s overall strategic plan that have been in place for quite some time now.
“As you look at what we call the construct of what we called the GSK Company. What has changed is that we have a joint venture with Novatis, and the entire positioning of the new company is one of the world’s biggest over-the-counter (OTC ) and healthcare companies.
So in keeping with that focus globally, for Nigeria, for strategic reason to bring that focus on the global portfolio, we took that decision of divestiture, ” he said.