GlaxoSmithKline has agreed to extend its strategic relationship with Aspen Pharmacare Holdings and to acquire a 16% shareholding in the South African pharmaceutical company.
This is part of a wide-ranging agreement which includes combining commercial activities in Sub-Saharan Africa and the divestment of several assets to Aspen.
Under the terms of the agreement, GSK and Aspen will collaborate on the commercialisation of their current and future product portfolios in Sub-Saharan Africa (excluding South Africa). The vast majority of combined current sales in this region are attributable to GSK.
The collaboration will build a broader and more diverse portfolio for these countries, with Aspen’s extensive pipeline of new products expected to benefit from greater leverage through GSK’s existing commercial infrastructure.
In South Africa, where Aspen has extensive commercial capability, GSK will transfer marketing and distribution rights to Aspen for its pharmaceutical products.
On completion, Aspen will issue 68.5 million new shares as non-cash consideration to GSK in exchange for the transfer of several assets. These shares will be equivalent to a 16% shareholding in the company; and Aspen has a current total market capitalisation value of £1.4bn.
As part of the agreement and on closure of the transaction, Aspen will appoint a non-executive director, nominated by GSK, to its board of directors.
The agreement is subject to regulatory approvals and is expected to complete before the end of 2009.