Reckitt Benckiser’s share price opened almost two per cent higher this morning, up by more than three per cent at its peak, after announcing it will spin off its pharmaceutical business into a separately listed company over the next 12 months.
The maker of household brands such as Nurofen confirmed the move which has been mooted since last year, saying it would concentrate on its consumer health and cleaning brands.
The pharmaceutical side of the business which makes Suboxone, used for treating drug addiction, has faced declining sales and profit, with revenue falling eight per cent in the six months to June.
Chief executive Rakesh Kapoor said:
“We believe that RB Pharmaceuticals has the potential to deliver significant long term value creation as a stand-alone business."
The move was announced with half yearly results which saw revenue rise three per cent across the business.