Investors seem none too impressed by Unilever’s series of £50bn bids for GSK’s healthcare businesses, the shares (already under pressure) dropping 7% in early trading this morning.
Maybe they, like Fundsmith’s Terry Smith, think Unilever should stick to its knitting and sort out its current issues. Smith’s tirade last week about Unilever being distracted by “purpose” was the last thing CEO Alan Jope needed.
Unilever seems disinclined to go away (retiring hurt at this stage would put Jope on the spot) but GSK healthcare is a big bite and both GSK (with 68% of the business) and 32% holder Pfizer may see bigger potential by holding on, however Unilever might sweeten its offer.
Pfizer is the big global winner from Covid-19 with its vaccine and, in what looks likely to be the coronavirus era, will surely have eyes on developing an over-the-counter treatment which would make billions. GSK is belatedly producing treatments too, which may have an OTC dimension.
Unilever is, doubtless, right to focus on healthcare but may have left it too late.