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| GSK's buyout plans in emerging mkt hit by high valuations |
| Press Trust of India / New Delhi Dec 10, 2009, 19:57 IST |
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UK-based GlaxoSmithKline's (GSK) plan to fuel its growth through acquisitions, particularly in emerging markets like India, are being hampered by the high valuations demanded by the promoters of the targeted company.
Speaking at a conference call from London, GSK's Emerging Market President Abbas Hussain today said, most of the firm's which are on GlaxoSmithKline's radar in the emerging markets have large promoter holdings and the valuation demanded by them are so high that GSK would not like to go for a deal.
Hussain said, in some respects, it is quite difficult to determine the value of the company as these firms have larger promoters holdings, who do not wish to exit in the current scenario where the companies are doing well, and are charging high prices.
He declined to comment on specific queries related to acquisitions.
Hussain, however, said "there is a view that they (promoters) do not want to exit, there is no reason to exit at this stage and valuations at which they choose to exit is so high that quite frankly as far as GSK is concerned we would not participate".
Global drug makers such as GSK and Pfizer are increasingly looking to low-cost destinations like India to tie up supplies as they battle falling prices and increasing generic competition.
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