Speculation is mounting that several potential bidders have held early talks in connection with buying malted milk hot drink Horlicks with Coca-Cola reportedly leading the charge with a £3bn (US$4bn) bid in the offing. Other interested parties include Kraft Heinz and Nestlé, according to reports.
US investment bank Morgan Stanley is advising GSK on the sale, according to The Telegraph.
As part of a major UK review, last July, GlaxoSmithKline (GSK) announced it was making strategic decisions concerning its consumer healthcare business and pharmaceuticals, including options to divest some nutrition brands and its intention to sell its Horlicks brand in the UK.
Then in March, GSK reached an agreement with Novartis for the buyout of Novartis’ 36.5 percent stake in their Consumer Healthcare Joint Venture for US$13 billion.
At the same time, GSK initiated a strategic review of Horlicks and its other consumer healthcare nutrition products to support funding of the transaction and to drive increased focus on OTC and Oral Health categories. Combined sales of these products were approximately £550 million (US$727 million) in 2017.
FoodIngredientsFirst has reached out for more information from GSK.
History of Horlicks
Horlicks has a long history that goes back to 1873 when pharmacist James Horlick and his brother William founded the company J & W Horlicks in Chicago to manufacture a patented malted milk drink as an artificial infant food.
By 1890 James had returned to London to set up an office importing the US-made product and by the early 1900s, Horlicks had become popular as a provision for the North Pole and South Pole expeditions by Robert Peary, Roald Amundsen, and Robert Falcon Scott.
The malted hot drink which contains wheat, malt barley, sugar, milk and 14 vitamins, went on to be used as a dietary supplement by US and British soldiers during the Second World War and in the early 20th century it was sold as a powdered meal replacement drink mix. It is now marketed as a nutritional supplement and manufactured by GlaxoSmithKline (Consumer Healthcare) in the UK, Australia, New Zealand, Hong Kong, Bangladesh, India, and Jamaica.