GlaxoSmithkline increases grip on Indian arm

Drug maker GlaxoSmithkline plans to increase its control over its publicly listed pharmaceutical subsidiary in India.GSK is launching a voluntary open offer in February to lift its stake in GlaxoSmithKline Pharmaceuticals Limited from 50.7% to up to 75% at a price of 3,100 Indian rupees per share.GSK said it would keep a quarter of the shares publicly listed, in line with Indian regulations requiring a minimum of 25% of a company's shares to be publicly held for it to remain on the market.It plans to buy up to 20,609,774 shares, making the deal worth up to £629m.Chief Strategy Officer David Redfern said: "For GSK this transaction will increase exposure to a strategically important market."The group will fund the deal through existing cash resources, expects it to be earnings-neutral for the first year and accretive thereafter and says it will not affect expectations for its long-term share buyback programme.The Indian arm, which makes respiratory, cardiovascular, oncology, anti-infective and dermatology treatments and employs more than 5,000 people, had a pre-tax profit in 2012 of about £116m.The offer is being managed by HSBC Securities and Capital Markets (India) Private.PW