Unilever says it will not increase £50bn bid for rival

PG Tips

Consumer goods giant Unilever has said it “will not increase” its £50bn offer for GlaxoSmithKline’s (GSK) healthcare arm after the bid was rejected.

The PG Tips and Dove soap maker said it had considered evidence from GSK, but said it had not changed its view on the value of the business.

GSK’s health products business owns brands such as Sensodyne toothpaste, Panadol and Centrum vitamins.

Unilever had previously said a deal would be a “strong strategic fit”.

The Marmite manufacturer says it wants a bigger slice of the health and hygiene sectors.

But in a statement on Wednesday, the company said it would “not increase our offer above £50bn”.

“We note the recently shared financial assumptions from the current owners of GSK Consumer Healthcare and have determined that it does not change our view on fundamental value,” it added.

Unilever said it was committed to “maintaining strict financial discipline” to ensure that “acquisitions create value for our shareholders”.

Shares in Unilever rose 4.5% after Wednesday’s announcement, having fallen sharply on Monday.

Unilever is the third largest company on London’s FTSE 100 index and is worth around £100bn. A deal would see it take over one of the biggest divisions of the FTSE 100’s fifth biggest company.

GSK, which runs its healthcare operation in a joint venture with US drug maker Pfizer, has previously said it wants to offload the division.

The company has rejected three Unilever offers, saying the proposals “fundamentally failed” to reflect the value of the business.

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