Pfizer Inc. has announced its intention to divest approximately £2 billion ($2.5 billion) worth of shares in Haleon Plc, a significant move marking the U.S. pharmaceutical giant's first step towards reducing its stake in the consumer health company. Currently, Pfizer is the largest shareholder in Haleon, holding a 32% stake, which will decrease to around 24% following the sale of 630 million shares. This strategic decision aligns with Pfizer's previously stated goal of scaling down its investment in the maker of well-known products such as Sensodyne toothpaste and Centrum vitamins.
Haleon, a prominent name in the consumer healthcare sector, was created through the merger of the consumer health divisions of GSK and Pfizer. Since its separation from GSK in 2022, aimed at allowing the British pharmaceutical firm to concentrate on its pharmaceutical and vaccines business, Haleon has seen its share prices fluctuate, experiencing a more than 3% drop in early trading in London following the announcement. However, the company's shares have generally been up by about 3% since the demerger, reflecting a cautiously optimistic market sentiment towards Haleon's future prospects.
The decision by Pfizer to reduce its stake comes amidst a broader industry trend where pharmaceutical companies are divesting their consumer health and generic drug divisions to focus more intensively on their core businesses of developing innovative treatments. Notable companies like Sanofi and Johnson & Johnson have undertaken similar strategic realignments. Haleon itself has demonstrated a positive outlook, with the company announcing in February potential revenue growth of up to 6% for the year, underscoring its ongoing efforts to streamline operations and enhance profitability.
The planned sale by Pfizer is set to be executed through a book-building process, with the offer price per share anticipated to be disclosed around March 19. The move is part of Pfizer's "slow and methodical" strategy to reduce its ownership in Haleon, as previously indicated last year. This step not only reflects Pfizer's strategic focus on its pharmaceutical innovations but also represents an opportunity for Haleon to attract new investors and possibly diversify its shareholder base.
As Haleon continues to navigate its post-spin-off trajectory, the company has also announced plans for a significant share repurchase program, signaling confidence in its financial health and growth prospects. Meanwhile, former parent company GSK has benefited from its gradual sell-down of Haleon shares, enhancing its focus on the development of vaccines and cancer treatments.
This transition period for Haleon, marked by Pfizer's sell-down and the company's own share repurchase initiatives, illustrates the dynamic nature of the pharmaceutical and consumer health industries. As companies like Pfizer recalibrate their investment portfolios, entities like Haleon are presented with both challenges and opportunities to redefine their market position and drive sustainable growth.