GlaxoSmithKline cashes in $694 million of Aspen shares

UK pharma giant GlaxoSmithKline (LSE: GSK) said yesterday (November 20) that it has agreed to the sale of 28.2 million ordinary shares (about one-third of its 19% stake) in South Africa’s largest drugmaker Aspen Pharmacare (APN: SJ) at a price of 250 rand per share, raising gross proceeds of 7.06 billion rand ($694 million).

Following settlement of the sale, GSK will hold 56.5 million ordinary shares in Aspen, representing 12.4% of the issued share capital. Aspen's stock has skyrocketed nearly 67% in the last year, according to Bloomberg.

GSK first invested in Aspen as part of a strategy to grow its presence in emerging markets and divested a manufacturing plant in Germany to Aspen, as well as several drugs, including cancer treatment Myleran and antibiotic Septrin, most recently the antithrombolytics Arixtra (fondaparinux) and Fraxiparine (nadroparin; The Pharma Letters June 19 and August 15, 2012 and September 30, 2013). The companies also agreed to collaborate on the commercialization of their product portfolios in the rest of sub-Saharan Africa.