Lucozade and Ribena 'up for sale'

Lucozade and RibenaHousehold drinks brands Lucozade and Ribena are set to be put up for sale for as much as £1 billion, it has been reported.

Parent group GlaxoSmithKline has already sounded out potential advisers for the sale of the two brands and is expected to confirm the plans within weeks, according to The Sunday Times.

Glaxo put Lucozade and Ribena under review in February as it said it was looking for the "best ways to ensure their continued growth". The drugs firm said it would consider all strategic options for the brands, which are primarily sold in western markets.

Lucozade and Ribena, which were owned by Beecham prior to its merger with SmithKline, date back to 1927 and the 1930s respectively. They form part of Glaxo's consumer healthcare division, which also includes the brands Horlicks and Panadol and posted a 5% rise in sales to £5.1 billion in 2012.

Lucozade achieved strong growth in emerging markets, with low single digit percentage growth in Europe resulting in a 4% rise overall for the final quarter of 2012.

The wider business suffered a difficult 2012 as it saw operating profits fall 5% to £7.4 billion following a 3% drop in turnover to £26.4 billion as austerity drives across Europe impacted on medicine prices and affected the development of new drugs across the continent.

Glaxo, which was not immediately available for comment, could make an announcement alongside its annual general meeting next month and has already said it would complete the review of the brands by the middle of the year.

The pharmaceutical company is likely to face questions over its plans for the drinks when it reports first quarter results on Wednesday.

Its update also comes after it was accused last week by the Office of Fair Trading (OFT) of paying off firms to delay the launch of cheap versions of its anti-depressant treatment in a move that denied the NHS "significant'' cost savings.

The OFT is alleging that Glaxo offered "substantial" payments to Alpharma, Generics and Norton Healthcare to hold off from supplying rival medicines to its blockbuster Seroxat treatment. But Glaxo denied the allegations and said it believed it "acted within the law".