GlaxoSmithkline/Unilever item re GSK's Consumer Health segment posted on Company News.

[idpickering]

Here; viewtopic.php?p=473668#p473668

And here; viewtopic.php?p=473666#p473666

Both these shares are mainstays in my HYP, and that of many other HYPers I suspect, so this may be of interest here.
I topped up my GSK holdings last year, and intend topping up my ULVR holdings soon too.

Interesting times indeed.

Ian.

[Gerry557]

A top up of Ulvr was on my radar too. It normally takes a bit of a dip around the early part of the year.

I'm not too sure how this will be taken by the market. You would expect a dip if they were "overpaying" but it seems a "slight premium".

I thought Russia might be the cause of the dip.

I also hold GSK so mixed feelings about the bid anyway even if I thought, when announced by GSK they were hiving off this part it would be a natural fit for Ulvr.

[funduffer]

I hold both ULVR and GSK in my HYP (GSK is my largest holding).

I had intended to see what yields the two parts of GSK (pharma and consumer healthcare) were going to offer before deciding whether to keep both parts.

Now we see ULVR trying to acquire the consumer health part, which is interesting. (Might it be referred to the CMA if they agree a deal?)

Top up the popcorn, and see what unfolds, I think!

No top-ups or sales of either for now, for me.

FD

[daveh]

A top up of Ulvr was on my radar too. It normally takes a bit of a dip around the early part of the year.

I'm not too sure how this will be taken by the market. You would expect a dip if they were "overpaying" but it seems a "slight premium".

I thought Russia might be the cause of the dip.

I also hold GSK so mixed feelings about the bid anyway even if I thought, when announced by GSK they were hiving off this part it would be a natural fit for Ulvr.

Just looked this morning and GSK is up 5% and Unilever is down 5%. Guess which I set up last week to buy with a small top up via HSDL's regular dealing service that only happens on certain days each month - with today being the day? Yep GSK!

[vand]

Yep, I've topped up on my ULVR. A fwd 4% yield is I think above the FTSE average for an (imo) above average quality defensive company that has admittedly been poorly handled in the last few years.

Tried to offload my GSK but my order didn't get filled. We'll see if it does over the course of the day. I've only held GSK for a year and had a good return on it in that time, but with the prospect of a looming dividend cut and the already higher shareprice the forward yields doesn't look nearly as attractive.

[BT63]

Top up the popcorn, and see what unfolds, I think!

From what has been released today, it sounds as if Unilever *really* want the GSK consumer business, while GSK are *really* determined to get a good price for it.
I expect Unilever will make another offer or two. Maybe someone else will also make an offer.

Eventually, I think GSK will get what they want for the business. The price could hurt ULVR's share price and profits in the short to medium term but in the longer term ULVR should sort themselves out.

From a HYP point of view I would make no buys nor sells of either company for the time being, but keep an eye out for a chance to pick up ULVR at a healthy discount if the market decides to dump their shares in coming months on fears of overpaying.

I hold GSK but not ULVR. If a deal goes ahead, leaving me with a small ULVR shareholding and a pile of cash, I might add more ULVR with the cash.

As a shareholder of GSK, I would be quite happy to receive the entire 'payment' for their consumer business in ULVR shares at £35, with no cash element to the deal.
I wonder if large GSK shareholders might think the same; a virtual 'merger' of ULVR+GSKCH would avoid significantly weakening ULVR's financial position. Unilever would make up approximately 60-65% of the new company and GSKCH around 35-40%.

[TUK020]

Can Reckitt afford to sit on the sidelines for this one?

[scrumpyjack]

Top up the popcorn, and see what unfolds, I think!

From what has been released today, it sounds as if Unilever *really* want the GSK consumer business, while GSK are *really* determined to get a good price for it.
I expect Unilever will make another offer or two. Maybe someone else will also make an offer.

Eventually, I think GSK will get what they want for the business. The price could hurt ULVR's share price and profits in the short to medium term but in the longer term ULVR should sort themselves out.

From a HYP point of view I would make no buys nor sells of either company for the time being, but keep an eye out for a chance to pick up ULVR at a healthy discount if the market decides to dump their shares in coming months on fears of overpaying.

I hold GSK but not ULVR. If a deal goes ahead, leaving me with a small ULVR shareholding and a pile of cash, I might add more ULVR with the cash.

As a shareholder of GSK, I would be quite happy to receive the entire 'payment' for their consumer business in ULVR shares at £35, with no cash element to the deal.
I wonder if large GSK shareholders might think the same; a virtual 'merger' of ULVR+GSKCH would avoid significantly weakening ULVR's financial position. Unilever would make up approximately 60-65% of the new company and GSKCH around 35-40%.

My guess is that the takeover only makes financial sense for Unilever if most is paid in cash not shares. Otherwise there would be a significant reduction in Unilever earnings per share.

[TUK020]

Also, it will be interesting to see at what GSKCB asking price Unilever decide it would be be easier to bid for the whole thing, and then dismember/sell the bits they don't want.

[Breelander]

Can Reckitt afford to sit on the sidelines for this one?

Oh please no, I hold them too. It's bad enough having two of my holdings fighting it out

[Gerry557]

A top up of Ulvr was on my radar too. It normally takes a bit of a dip around the early part of the year.

I'm not too sure how this will be taken by the market. You would expect a dip if they were "overpaying" but it seems a "slight premium".

I thought Russia might be the cause of the dip.

I also hold GSK so mixed feelings about the bid anyway even if I thought, when announced by GSK they were hiving off this part it would be a natural fit for Ulvr.

Just looked this morning and GSK is up 5% and Unilever is down 5%. Guess which I set up last week to buy with a small top up via HSDL's regular dealing service that only happens on certain days each month - with today being the day? Yep GSK!

Daveh, welcome to Sod's Law!

Fortunately I had plans to add more Ulvr as part of the annual dip it seems to take in the early part of the year. I was expecting Feb/Mar time but added on yesterday's drop.

I suppose it could still do that later drop, after all Sod likes to share and I'm sure he's out to get me too.

[daveh]

A top up of Ulvr was on my radar too. It normally takes a bit of a dip around the early part of the year.

I'm not too sure how this will be taken by the market. You would expect a dip if they were "overpaying" but it seems a "slight premium".

I thought Russia might be the cause of the dip.

I also hold GSK so mixed feelings about the bid anyway even if I thought, when announced by GSK they were hiving off this part it would be a natural fit for Ulvr.

Just looked this morning and GSK is up 5% and Unilever is down 5%. Guess which I set up last week to buy with a small top up via HSDL's regular dealing service that only happens on certain days each month - with today being the day? Yep GSK!

Daveh, welcome to Sod's Law!

Fortunately I had plans to add more Ulvr as part of the annual dip it seems to take in the early part of the year. I was expecting Feb/Mar time but added on yesterday's drop.

I suppose it could still do that later drop, after all Sod likes to share and I'm sure he's out to get me too.

If I'd thought about it there was news about the possible Unilever bid over the weekend and maybe I should have cancelled the deal over the weekend to see which way it the price was going to go, but my reason for topping up GSK was I was thinking the market was undervaluing the health care part of the business and it might be worth picking up more before they split it off. Ah well as you say the law of sod and win some lose some.

Edit to add GSK is down a little today (0.75%) in a falling market, but ULVR is down another 3%

[Gerry557]

In years to come the last couple of days SP for both GSK and ULVR will be classed as just noise.

Well, unless the deal is agreed and ULVR is in debts up to its eyeballs and its the start of its great failure. Mr Buffet's words on companies being run by idiots comes to mind.

“I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will"

[BT63]

In years to come the last couple of days SP for both GSK and ULVR will be classed as just noise.

Well, unless the deal is agreed and ULVR is in debts up to its eyeballs and its the start of its great failure. Mr Buffet's words on companies being run by idiots comes to mind.

“I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will"

Yes, the current share price moves will be forgotten in a few years time.

Unilever is the kind of company that is very likely to be salvageable after being run by idiots.

It's even possible that ULVR could pay a high price for GSKCH but still manage to do well from the acquisition if it integrates well.

[idpickering]

Just released;

Unilever update posted on Company News here; viewtopic.php?p=474496#p474496

In short they say;

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.

Accordingly, we will not increase our offer above £50bn.

Unilever is committed to maintaining strict financial discipline to ensure that acquisitions create value for our shareholders. Unilever also reiterates its commitment to continuing to improve the performance of its existing portfolio through its ongoing focus on operational excellence, its upcoming reorganisation and by rotating the portfolio to higher growth categories.

nb, my bold.

Ian.