Pharmaceutical giant Pfizer Inc. has finalized its exit from consumer healthcare company Haleon PLC, selling its remaining 7.3% stake for approximately $3.3 billion, the companies announced on Tuesday.
The transaction involves the sale of approximately 662 million Haleon shares through a combination of a secondary offering to institutional investors and a share repurchase agreement with Haleon. The final price will be determined through an accelerated bookbuilding process based on investor interest.
As part of the arrangement, Haleon will buy back £170 million (approximately $216 million) worth of its shares from Pfizer in a private transaction, at the same price established through the bookbuilding process.
Strategic Divestment Completes Separation
This sale marks the final step in Pfizer's gradual reduction of its ownership in Haleon, which began when the consumer healthcare company was spun off as an independent entity in July 2022. Haleon was originally formed in July 2019 through the merger of GlaxoSmithKline's (GSK) and Pfizer's consumer healthcare divisions.
The divestment follows a similar move by GSK, which fully exited its stake in Haleon in May 2024. With both founding pharmaceutical companies now divested, BlackRock Investment Management (UK) Ltd., a subsidiary of BlackRock, will become Haleon's largest shareholder with more than a 5% stake, according to London Stock Exchange Group data.
Haleon's Market Position and Portfolio
Haleon has established itself as a significant player in the global consumer healthcare market since its independence. The company owns several well-known consumer brands including Sensodyne toothpaste, Centrum vitamins, Otrivin nasal spray, and Eno antacid products.
The company's brand portfolio spans oral health, pain relief, respiratory care, digestive health, and nutritional supplements, positioning it as a diversified consumer healthcare specialist.
Pfizer's Financial Outlook
For Pfizer, the stake sale provides additional capital as the company continues to navigate challenging market conditions. Despite strengthened financials, Pfizer's stock has experienced a prolonged decline, falling more than 50% from its December 2021 peak of $59.50.
Analysts maintain a cautiously optimistic outlook on Pfizer, with the stock receiving a "Moderate Buy" consensus rating based on five Buy and nine Hold recommendations over the past three months. The average price target of $31 suggests a potential upside of 18% from current levels.
"This transaction represents the completion of our planned exit from Haleon as we continue to focus on our core biopharmaceutical business," said a Pfizer spokesperson. "The proceeds will provide additional financial flexibility as we advance our innovative medicine pipeline."
Market Implications
The sale is being executed through an accelerated bookbuilding process, a common method for large block trades that allows for rapid pricing and execution. J.P. Morgan and Goldman Sachs are serving as joint global coordinators and bookrunners for the offering.
Trading in Haleon shares was relatively stable following the announcement, reflecting market expectations that the sale had been anticipated and priced in by investors. The transaction is expected to have minimal impact on Haleon's day-to-day operations, as Pfizer had already transitioned to a passive investor role.
For institutional investors, the offering presents an opportunity to acquire a significant position in a leading consumer healthcare company with established global brands and steady cash flow generation.
