GlaxoSmithKline to spend a billion raising its stake in India

GlaxoSmithKline is to pay £629 million (64 billion Indian rupee and about one billion US dollars) in raising its 50.7% stake in its Indian subsidiary to 75% - the maximum allowed by India for foreign holding of publicly listed companies in the country.

The company's head of strategy said the transaction would "increase exposure to a strategically important market".

"GSK has a proud heritage in India. Today's announcement is a further demonstration of our long-term commitment to the country having increased our holding in our consumer business earlier this year and more recently committed to a significant manufacturing investment."

David Redfern, chief strategy officer, GlaxoSmithKline.

India's pharmaceutical market is worth about US$12 billion, Bloomberg reported. GlaxoSmithKline Pharmaceuticals Ltd, the operation in India, employs over 5,000 people and yielded a 2012 profit of £313 million (about US$510 million), a statement from GSK says.

The local company manufactures, distributes and commercialises pharmaceuticals and vaccines in areas including respiratory, cardiovascular, oncology, anti-infectives and dermatology.