Will GlaxoSmithKline sell off Lucozade and Ribena?

Will GlaxoSmithKline sell off Lucozade and Ribena?

GlaxoSmithKline has confirmed to just-drinks that it has launched a strategic review of its Lucozade and Ribena soft drinks brands, with “every option”, including a sale, being considered.

The UK-based company, which announced its Q4 and full-year results yesterday (6 February), has begun the review to “look at the best way to invest behind and grow the brands in the future”. A sale of the two is also being looked at.

Speaking to just-drinks today, a spokesperson for GSK said the firm plans to have a decision in place “by mid-year”.

“They (Lucozade and Ribena) currently have a limited geographic footprint,” the spokesperson said. “The review will look at the best way to invest behind and grow the brands in the future.”

Among the options being considered are franchising and licensing, to potential divestment or significant investment.

“We're completely open to any option,” the spokesperson highlighted. “We haven't made any decision yet.”

In the three months to the end of December, Lucozade's sales rose by 4%, GSK said yesterday. The brand had "strong growth in emerging markets and low single-digit percentage growth in Europe", the company said. 

GSK has ring-fenced its projected advertising and promotional budgets for the two in the current calendar year.

Only 12 months ago, GSK unveiled plans to invest GBP18m in its Gloucestershire Lucozade and Ribena production facility in the UK.

Lucozade is available in 30 markets, while Ribena is in 24 countries. Neither are currently in the US.

Last year, the two brands generated sales of GBP600m (US$939.5m) for GSK, with the group's consumer health care business delivering GBP5.1bn in sales.