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news.Pharma giant GlaxoSmithKline has sold its stake in the New York-listed, contract research firm, Quest Diagnostics for $1.7bn (£1.05bn).
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The sale buoyed hopes that Glaxo would restart a share buyback programme to bolster its share price, and also freed cash for Glaxo to pay a £2.2bn net charge imposed on 17 January, resulting from legal disputes going back to 2004.
Quest was a non-core asset Glaxo acquired in 1999, but had been reducing its shareholding for some time. Glaxo finally sold 30.8m shares, equivalent to 18 per cent of Quest, through a public share offering, of which Quest bought half. After taxes, the company is expected to retain $1.1bn of the proceeds.
Glaxo CFO Julian Heslop said that the divestment demonstrated Glaxo’s focus on generating attractive returns for its shareholders and its ability to monetise significant gains when appropriate.