GlaxoSmithKline Pharmaceuticals - GSK tender offer at Rs. 3,100/share - Kotak

GSK announced a tender offer to increase its stake in the Indian pharmaceuticals subsidiary to 75%. The offer price will be Rs. 3,100/share (26% premium; deal value: Rs. 63.9 bn) valuing GSK Pharma at 36X CY2015 EPS, a significant premium to peers.

We note that GSK's tender offer for the consumer subsidiary in India failed to reach the targeted shares but there was no revision in the offer price. We suspend rating on the stock (SELL previously) given the stock price will reflect the offer price and limited impact of fundamental factors.

Source : Equity Bulls

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