Durex condoms and Nurofen maker Reckitt Benckiser today said its £1.3 billion drugs business could be split off and listed separately rather than sold outright.
Reckitt, which reported first-quarter sales up 4% today, said a separate listing of its pharmaceutical arm is “a strong option” after a strategic review. Analysts said the “demerger or IPO” is now likely because of the difficulty in finding a buyer for the business.
Chief executive Rakesh Kapoor said Reckitt will provide more information on the review at its half-year results in July.
Reckitt reported a 4% rise in comparable sales of its non-pharmaceutical business. Its consumer-health division beat expectations with sales up 11%. The company has been reported to be frontrunner to buy Merck & Co’s consumer brands. Analysts at Jefferies said: “The new sweet spot of consumer health has beaten our expectations, setting the stage perfectly for a potential Merck deal.”
Meanwhile, yoghurt maker Danone said first quarter underlying sales growth had slowed. The group, which had previously been hit by a baby food scandal in Asia, said total group sales reached €5.06 billion (£4.15 billion), up 2.2% on a comparable basis but down from 2.9% in the fourth quarter of 2013.
