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May 12 (Reuters) - British drugmaker GSK on Friday sold 240 million shares in its consumer healthcare business Haleon at 335 pence per share, raising about 804 million pounds ($1 billion), the company said.
Further information to be found in HLN news on this site
I knew it wasn’t totally the answer and obviously HLN could not borrow that kind of money to buy back.
However the £15 bill overhang would not be worth as much if they did try to start dumping them.
So an offer for some might be seen as a good compromise by both sides ,instead of this continuing to be a negative for both parties.
Or like you say someone who wants it may step in and buy up.
Probably not ULVR even though they would be buying much cheaper than their offer.
It’s sometimes not easy to exit one of these situations
It's a problem of scale , the overhang of shares in the hands of reluctant holders is almost 5bill. worth around £15bill, the only viable medium-term solution is sale to a more willing holder who wants part (or all?) of HLN. At average volumes it would take several years to drip them into the market without driving the price down substantially . In truth when the GSK board engineered the split, they ensured that the bit where they personally remain is viable(assuming a reasonable flow of new treatments) while the rest was thrown overboard and had a concrete lifebelt thrown to it.
To add to below
If they started a div reinvestment scheme they could then get market price to slowly feed them back in after purchase.
And they obviously could be used for BOD bonus options.
I’m sure there is a good reason why it’s not a goer.
One partial solution might be for HLN to get authority to repurchase some of them.
Since they have managed to drop the debt they could likely borrow £1 billion.
Since Pfizer would likely be selling into a falling market, there could be a deal to be made.
This might be acceptable to Pfizer since it could possibly be repeated every couple of years as HLN would need a breather to get debt back on track.
Just really thinking out loud, don’t know if it’s possible or likely.
Hi Box... I was a holder of both ULVR and GSK at the time of the ULVR approach for what is now essentially HLN, and said that GSK's failure to sell was idiocy. time has, I think proved me right. HLN is in a bind, almost half of its stock is owned by Pfizer and GSK and BOTH are committed to selling .I said in a post months ago that I felt that would be a drag on HLN's SP regardless of how well sales and profits went , indeed as the SP rises so the likelihood of sales by GSK/PFE grows.
The SP here is essentially flat since launch and is IMV unlikely to rise much from here . the recent piece in the FT see
https://www.ft.com/content/ec441144-52ae-4fa2-8a04-4238db0ee504?emailId=9ddd2df7-69d5-44e6-896f-f501dd3a51d9&segmentId=69ce8bbf-afc9-7c01-fb70-6e4448aa1f37
reminds everyone that large scale potential sales will be a drag on SP performance for months, possibly years. A persistent and committed seller of a a very large block of stock cannot be good news.
Just wondering how the Pfizer share sale of Haleon will affect the share price. Could these be sold in dribs and drabs and keep the price depressed for months or is it possible that one buyer could take the lot? I would imagine that many people who have Haleon after the GSK split may take this opportunity to offload their holding now. Any thoughts?
Several posts from when last div announced below
Think it currently makes sense for minimal div while debts are high.Good to see debt drop by approx 10%
I was a little surprised to see such a small dividend on the back of such healthy looking results.
But if they are reducing the sizeable debt then it will be worth a little short term pain.....
I agree that a reduction in HLN debt would be a good move for longer term rewards, and as such I would like to see it reduced over the next few years, even at the expense of higher dividends.
Currently all about reducing the debt GSK loaded onto the company at the split
According to div max ex Div date is 14th Sept payment date is 27th Oct as for how much no idea.....But your right last divi was paltry....
Does anyone have a dividend forecast for 2023? Since the demerger I have found information about this difficult to find. The final dividend just paid seemed paltry and no indication was given in the final results about future payouts.
...for starters:
https://www.***************************/haleon-plc-10.0-potential-upside-indicated-by-barclays/4121116782
This has to be a keeper, and add on the dips. IMO. I am well in profit through that strategy.
HLN have got permission to purchase their own shares in the market and to make off market purchases of their shares from Pfizer and GSK.
it would have to be higher than the previous offer - not sure that Unilever are in a good enough shape to make an offer with shareholder approval
Longtime do you think Unilever will come back with another offer?
''GSK had loaded £10.7bn of debt onto Haleon bringing the figure much closer to the Unilever price. ''
HLN has made a start on reducing the debt - now down to £9.9 Billion.
Yes you're right right about the debt I stand corrected.....I got these like many others from the demerger happy to keep for the mean time and will see where we stand in a couple of years from now.....
GSK had loaded £10.7bn of debt onto Haleon bringing the figure much closer to the Unilever price. The OTC business was always the cash cow for GSK and had carried the business for a long time. My wife and I decided (hindsight is a powerful tool), after the demerger, to significantly increase our shareholding in Haleon, as it was no longer saddled with the previously underperforming GSK. We knew that the initial priority for the company was to pay off this debt which they are doing. The growth projections are good and management are moving the business in the right direction.
Before a pile of trolls pile in, I still am still invested in GSK and am seeing the green shoots of R&D starting to emerge. No longer have they got the safety net of Haleon and so their management now have to perform.
If i remember rightly Unilever offered £50 Billion so a long way for the sp to go to get near that figure...
or should that be nearer to what Unilever wanted to pay
''Have we had a bad deal re HLN shares''
?
share price getting nearer to what Glaxo said the unit was worth when there was an interested party
Have we had a bad deal re HLN shares .
Pfizer and one other which I can't recall own about 25 / 30% of the shares since the split which they will look to unload as some point.
Sold a few more for 345p
I noticed after yesterdays sale the number only part of the buy back on 17th August 2023 259p.
All of that top up sold now .
Still have original buy idea to top up demerger small holding .
The bike repair was next to nothing so not sure why I bothered posting "More then paid for bike repair" on 13th August below .
259 to 341 is 32% ( 5/4/23 )
270 to 259 is 3.9% ( 17/8/22 )
252 to 270 is 7.1% ( 12/8/22 )