Suntory will acquire global rights to the Ribena and Lucozade brands and GSK’s Coleford manufacturing site. Annual sales of the Lucozade and Ribena combined were about £0.5bn in 2012, GSK says.
The deal is a major coup for Suntory to boost its presence in Europe. It is best known in the region as the owner of the Orangina brand and a range of Japanese whisky. The strength of Suntory in markets outside Europe is likely to help the Lucozade and Ribena brands, which are currently only particularly well known in Britain and Ireland, boost their global appeal.
Some 700 GSK staff, including those in the marketing and commercial teams, will transfer across to Suntory, the majority of which will be UK based.
Last month GSK created a new management team for the Lucozade and Ribena business to ensure a “smooth and swift transition” for the brands’ divestment.
The senior team is led by Peter Harding, formerly GSK Great Britain and Ireland general manager for consumer healthcare. The team also consists of UK and Ireland marketing director Carol Smith, international marketing director Jon Roberts, sales director Gareth Smyth and Ireland country manager Rory Brennan.
A new management team was also formed for the remainder of the businesses that make up GSK’s consumer healthcare division – which includes brands such as Sensodyne, Aquafresh and Beechams – led by Carlton Lawson.
David Redfern, GSK chief strategy officer, says: “Lucozade and Ribena are iconic brands that have made a huge contribution to GSK over the years, but now is the right time to sell them as we increase the focus of our Consumer Healthcare business and execute the delivery of our late stage pipeline of pharmaceuticals and vaccines.
“We believe the future of Lucozade and Ribena is in good hands given Suntory’s established beverages business, ambitious growth plans and also their recognition of the strong performance and capability of the GSK employees working on these products.”
GSK and Suntory expect the £1.35bn cash transaction to complete by the end of the year, subject to regulatory approvals. GSK’s share price was down 0.15 per cent to 1648.5p at the time of writing.
It is not yet known how Ribena and Lucozade’s ad agency relationships, with M&C Saatchi and Grey London respectively, will be affected by the deal.